Treasury Yield Spread Narrows to 0.52 Percentage Points
New Treasury data shows a tightening yield curve alongside mixed labor and inflation signals from federal agencies.
**Coverage:** Fresh at 2026-08-18: 10-Year Treasury Minus 2-Year Treasury Yield Spread. Latest available but older: Personal Consumption Expenditures Price Index, Real GDP, % Change from Preceding Period, Average Hourly Earnings, Total Private (SA), CPI-U, All Items (NSA), CPI-U, All Items (SA), CPI-U, All Items Less Food & Energy — Core CPI (SA), JOLTS Job Openings, Total Nonfarm (SA), PPI Final Demand (SA), Total Nonfarm Payroll Employment (SA), Unemployment Rate (SA), Advance Monthly Retail Sales, Total (ex. auto/gas categories vary), New Residential Construction, Housing Starts (Total), 10-Year Treasury Constant Maturity Rate, 2-Year Treasury Constant Maturity Rate, Effective Federal Funds Rate, ICE BofA US High Yield Index Option-Adjusted Spread.
The 10-Year Treasury Minus 2-Year Treasury Yield Spread fell to 0.52 percentage points on August 18. This represents a 0.01 percentage point decrease from the previous day and a 0.05 percentage point drop from August 18, 2025. The 10-Year Treasury Constant Maturity Rate rose to 4.72% on August 17, while the 2-Year Treasury Constant Maturity Rate reached 4.19%.
The unemployment rate fell 0.10 percentage points to 4.10% in July. However, total nonfarm payroll employment decreased by 23,000 persons from June. Job openings also declined, with total nonfarm openings reaching 7,359,000 in June, a 2.4% drop from May. Average hourly earnings for total private workers rose 0.1% to 37.62 dollars per hour in July.
Inflation indicators remain varied. The seasonally adjusted CPI-U for all items rose 0.1% in July, while the Core CPI increased 0.2% to an index of 336.79. Conversely, the PPI Final Demand index fell 0.7% from June. The Personal Consumption Expenditures Price Index decreased 0.1% month over month in June.
Activity in the broader economy showed signs of cooling. Real GDP grew 1.50% in the period ending April 1, which was 0.60 percentage points lower than the preceding period. July retail sales fell 0.6% to 763.6 billion dollars, and housing starts dropped 12.4% to 1,239,000 units.