We have discussed yield curves at several PIG meetings and noted their conventional, upward slope from low short term rates to higher long term.  In recent weeks there has been a rare shift in the short term to below the medium term rates.  This has happened mostly in the US but Australia also shows this trend although at a lesser difference.  US experience has been that forecasters link inverse yield curves to a declining equities market. I am attaching the latest yield curves for the US and Australia and would like to discuss their position at next week’s PIG meeting.