Market’s curve could predict recession

HERE’S a tricky question for a Monday morning: does an inverted yield curve necessarily predict a recession?

Now you're probably about to skip this article and turn to the sports section, but bear with me, because this is the most topical debate in the markets today.

The yield curve is a very simple tool that markets use to graph interest rates over time. In normal circumstances, investors demand a higher return for loans of longer duration, so the yield curve has a positive slope (from the bottom left of the graph to the top right).