Spread between 2- and 10-year Treasury yields briefly falls below zero for first time since June 14

A widely followed indicator of the economic outlook briefly flashed a recession warning on Tuesday as fears of a downturn continued to grip markets. The spread between 2- and 10-year yields briefly fell below zero Tuesday morning for the first time since June 14, driven by a bigger decline in the 10-year rate than in the 2-year yield. Investors piled into the safety of government bonds amid a selloff in stocks that sent Dow industrials down by more than 600 points. An inversion of the 2s10s spread is considered to be a reliable indicator of a recession, albeit with a lag.

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