Bear Flattener

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Bear Flattener

A situation in which the yield curve for bonds is flattening. That is, short-term interest rates on bonds rise more rapidly than long-term rates so that the two begin to converge, resulting in a flat (or flatter) yield curve when it is plotted on a graph. This is considered a bearish indicator because it means that investors believe that the higher interest rates on short-term bonds may produce a higher return than stocks will in the short-term. See also: Inverted yield curve, bullish flattener.