US Treasuries Zero-Coupon Yield Curve

FAQ

• What are the main drivers of the shape and movement of the US Treasuries zero-coupon yield curve?

  
  The main domestic drivers of the US Treasuries zero-coupon yield curve include Federal Reserve decisions, inflation and inflation expectations, labour-market conditions, the economic growth outlook, the budget deficit, the Treasury’s borrowing requirements, and public debt dynamics. External influences include global demand for safe and reserve assets, international capital flows, geopolitical risks, and conditions in the global financial system.

• What does the yield curve slope shape indicate in terms of market participants' economic expectations?

  
  From the perspective of market participants' expectations, each curve shape conveys a specific scenario:
  

  • A normal curve indicates expectations of steady economic growth and stable inflation. Investors demand a risk premium for holding long-term government bonds, confident in the state's ability to service debt in the future. This shape reflects a healthy economic development path without signs of an impending crisis.
  • An inverted curve signals high recession risks in the near future. Market participants price in expectations of a policy rate cut by the regulator in response to slowing business activity. Investors' willingness to lock in long-end yields below current short-term rates indicates pessimism about short-term prospects and a desire to secure returns before the monetary easing cycle begins.
  • A flat curve reflects uncertainty and a transitional phase in the economic cycle: the spread between short-term and long-term rates is minimal, indicating a lack of clear market direction; monetary policy is perceived as restrictive, but its impact on growth and inflation has not yet fully materialized. This configuration often precedes a trend reversal—either toward growth or contraction.
  • A humped curve points to complex, heterogeneous expectations: the market prices in temporary rate hikes or sustained high rates in the medium term (due to inflationary shocks or fiscal risks), yet believes in normalization over the long horizon, implying expectations of policy tightening in the coming years followed by a return to low rates as the economy stabilizes.

• Which maturity combinations on the yield curve should be relied upon when assessing the United States economic outlook?

  
  The choice of tenor combination depends on the forecasting objective: if the goal is inflation, the forecast horizon must match the maturity difference (a classic example is the 5Y–1Y spread for a five-year horizon). If the goal is to assess future economic activity, it is more effective to use the widest available spread on the given curve, i.e., to evaluate the difference between the maximum and minimum tenors. The standard combination in this case is the 10Y–2Y spread. High correlation among various wide spreads allows any of them to be used without loss of forecast quality.

• How should the short and long segments of the curve be interpreted within its available tenor structure?

  
  The curve spans maturities from 1 day to 30 years and comprises 129 points.
  

  • The short segment (1 day–1 year) has a very high tenor density, providing maximum sensitivity to near-term policy interventions and current liquidity conditions.
  • The medium segment (2–7 years) reflects expectations regarding the economic cycle and inflation over the medium term.
  • The long segment (7–30 years) is shaped by fundamental factors. The extension to 30 years allows the ultra-long-term structural stability of the U.S. economy to be assessed.

• How does the yield curve reflect the market’s assessment of sovereign credit risk?

  
  The yield curve may incorporate a premium required by market participants as compensation for sovereign credit risk. A deterioration in the assessment of the government’s ability to meet its debt obligations generally increases required yields and may raise either the entire curve or particular segments. Where risk is considered more significant at certain maturities, the most pronounced movement may occur in the corresponding part of the curve. The approximate size of the premium can be assessed by comparing yields with those on maturity-matched government securities issued by a more creditworthy sovereign.

• Who issues U.S. Treasury securities and organises federal borrowing?

  
  U.S. Treasury securities are issued by the U.S. Department of the Treasury. Federal borrowing policy is formulated by the Office of Debt Management, while the Bureau of the Fiscal Service organises auctions and handles the issuance, registration, and servicing of the securities. The yields on Treasury instruments across different maturities serve as the underlying market benchmarks for the U.S. Treasuries zero-coupon yield curve.

• Can the government bond yield curve be used as a benchmark for valuing corporate bonds?

  
  Yes. The government bond yield curve can be used as a baseline benchmark when assessing corporate bonds with a comparable maturity and in the same currency. The curve indicates the base yield available on government debt instruments, whereas a corporate bond yield will typically include an additional premium. This premium may reflect the issuer’s credit risk, the liquidity of the issue, its structural features, and other risks associated with the company or the specific bond. The yield differential represents the additional return investors require relative to government debt instruments.

• How does government bond market liquidity affect the yield curve?

  
  High market liquidity supports a more stable and representative yield curve. Greater market depth, a broad set of actively traded issues, and regular transactions make it possible to estimate yields more accurately across different maturities. A sufficient volume of up-to-date quotations also reduces the influence of isolated price observations. When liquidity is low, certain sections of the curve may become less smooth, depend more heavily on individual trades, and provide a weaker indication of current market conditions.

• How can yield curve values for different dates be compared and their dynamics assessed?

  
  The default page view includes the latest yield curve and a curve based on values from approximately one month earlier. Additional dates for comparison can be selected using the “Add date” field, with no more than 10 dates displayed simultaneously. The “Show dynamics” feature is available for analysing changes in the yield curve over a specified time interval.

• What is the publication frequency for USA zero-coupon yield curve data?

  
  Data updates are performed weekly: current values are typically published on Tuesdays for the period ending on the Friday of the previous week. For example, data for the week ending May 3, 2026 (Friday), is published on Tuesday, May 7, 2026.