Yield Curve

[yeeld kurv]

What is the definition of Yield Curve?

A graph that illustrates the relationship between interest rates and the maturities of debt securities of the same credit quality, showing how these rates vary with different maturity dates.

Using Yield Curve in an Example

In finance, the yield curve is a crucial indicator used by analysts to understand interest rate trends and economic forecasts. A normal upward-sloping yield curve suggests that longer-term securities have higher yields compared to short-term bonds, indicating investor expectations of rising interest rates and economic growth over time.

Using Yield Curve in a sentence

During the meeting, the financial analyst presented the yield curve to highlight the potential for increased borrowing costs over the next five years.

Related Terms

Yellow Book

The 'Yellow Book' refers to the 'Government Auditing Standards' issued by the Comptroller General of the United States, which outlines the auditing standards for government organizations, programs, activities, and functions, as well as for entities receiving government assistance.

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Yield

The income return on an investment, such as dividends or interest, expressed as a percentage of the investment's cost or current market value.

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Yield to Call

The return on a bond calculated by assuming the bond will be redeemed by the issuer at the earliest call date specified in the indenture agreement.

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Yield to Maturity

The total return anticipated on a bond if the bond is held until its maturity date, considering all payments of principal and interest, adjusted for any premium or discount to the face value of the bond.

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