Normal Yield Curve

Normal Yield Curve

A yield curve that trends upward, indicating that the interest rates for long-term debt securities are higher than short-term debt securities. This is the regular way a yield curve trends because investors demand a higher return for the higher risk of tying up their capital in securities with longer maturities. It is less commonly called a positive yield curve. See also: Negative Yield Curve, Flat Yield Curve.
References in periodicals archive ?
When we again have a more normal yield curve, with short-term rates lower than long-term rates, we foresee a return to higher spreads for MFA.
They can then invest a core portion of their portfolio in longer-term securities, such as a 2-year Treasury note, to take advantage of higher yields in a normal yield curve environment.
On the positive side, however, as the folly of the competitors' thinking became apparent in the fourth quarter, Clifton Savings witnessed a return to a more normal yield curve.
2% by year end -- restoring a normal yield curve in the second half, as growth improves," Raha said.