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Benchmark U.S. Treasury yields tumbled on Tuesday and a key part of the yield curve inverted for the first time in three weeks as concerns about economic growth dented risk appetite and increased demand for the safe haven U.S. debt.

Yields have dropped from the highest levels in more than 10-years as investors worry that the Federal Reserve’s aggressive rate hikes meant to tackle soaring inflation will send the U.S. economy into a recession.

Investors have also pared back expectations on how high the U.S. central bank will raise its benchmark rate as concerns about an economic downturn increase.

“It seems like the recession warning bells continue to ring a little bit louder each day,” said Thomas Simons, a money market economist at Jefferies in New York. That said, “I think that the yield curve can remain inverted for some time before the Fed actually does change course on policy.”

The two-year, 10-year part of the Treasury yield curve reinverted on Tuesday, a move that is seen as a reliable indicator that a recession will follow in one-to-two years.

The two-year, five-year part of the curve also inverted for the first time since Feb. 2020, another indicator that an economic downturn is likely.

Benchmark 10-year yields were last at 2.816%, just above a one-month low of 2.791% reached on Friday. They have fallen from 3.498% on June 14, the highest since April 2011.

Two-year Treasury yields were at 2.800%, after hitting 2.729% on Friday, the lowest since June 7. They have fallen from 3.456% on June 14, which was the highest since November 2007.

Fed funds futures traders are now pricing for the Fed’s benchmark rate to peak at 3.29% in February, down from expectations before the Fed’s June 14-15 meeting that it would increase to around 4% by May. It is currently 1.58%.

The Fed will release minutes from its June meeting on Wednesday, which will be scrutinized for any new clues on how large rate hikes are likely to be over the coming months. The Fed is widely expected to hike rates by 75 basis points for the second meeting in a row when it meets on July 26-27.

The next major U.S. economic release will be Friday’s jobs report for June.

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