Treasury Yields Snapshot: December 12, 2025

Core Insights - The 10-year Treasury yield finished at 4.19% on December 12, 2025, with the 2-year note at 3.52% and the 30-year note at 4.85% [1] - The inverted yield curve, where longer-term yields are lower than shorter-term yields, is a reliable leading indicator for recessions, with the 10-2 spread turning negative before recessions [2][3] - The average lead time to a recession based on the first negative spread date is approximately 48 weeks, while using the last positive spread date yields an average of 18.5 weeks [4][6] Treasury Yield Trends - The 10-3 month spread also indicates recession lead times ranging from 34 to 69 weeks, with recent negative spreads observed from October 25, 2022, to December 12, 2024 [5] - The Federal Funds Rate (FFR) influences borrowing costs, impacting mortgage rates; however, recent trends show mortgage rates declining despite the Fed holding rates steady, with the 30-year fixed rate at 6.22% [7] Market Behavior - Federal Reserve policy has significantly influenced market behavior, particularly in relation to Treasury yields and the S&P 500 [8] - Various ETFs associated with Treasuries include Vanguard 0-3 Month Treasury Bill ETF (VBIL), Vanguard Intermediate-Term Treasury ETF (VGIT), and Vanguard Long-Term Treasury ETF (VGLT) [9]