The shape of the yield curve, which plots the return of Treasury securities, is one of the most reliable indicators of the health of the economy, and it has been flashing signs of a looming recession for most of July.

An inverted yield curve is often seen as a signal that investors are more nervous about the immediate future than the longer term, leading interest rates on short-term bonds to move higher than those paid on long-term bonds.

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Fed Chair Jerome Powell on Wednesday said that he does not think the economy is currently in recession, but yield curves say something else. They've moved into an "inversion" in the past few weeks.

A yield curve inversion has preceded every single recession since 1955, according to research from the Federal Reserve Bank of San Francisco.

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The shape of the yield curve, which plots the return of Treasury securities, is one of the most reliable indicators of the health of the economy, and it has been flashing signs of a looming recession for most of July.

An inverted yield curve is often seen as a signal that investors are more nervous about the immediate future than the longer term, leading interest rates on short-term bonds to move higher than those paid on long-term bonds.

*

Fed Chair Jerome Powell on Wednesday said that he does not think the economy is currently in recession, but yield curves say something else. They've moved into an "inversion" in the past few weeks.

A yield curve inversion has preceded every single recession since 1955, according to research from the Federal Reserve Bank of San Francisco.

• PAID PARTNER CONTENT