Generally speaking, an upward-sloping yield curve can be expected when:
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A) |
the supply of long-term funds falls short of demand and investors begin to show a preference for more liquid/less risky short-term securities. | |
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B) |
the supply of long-term funds falls short of demand. | |
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C) |
inflationary expectations are beginning to subside and investors begin to show a preference for more liquid/less risky short-term securities. | |
When demand for loanable funds outstrips supply, interest rates can be expected to rise in that (long-term) segment of the market; also, more preference for short-term securities can be expected to drive up long-term rates as the liquidity premium rises. Thus, both circumstances in the answer can be expected to put upward pressure on the long end of the yield curve. | 
发表于 2011-3-30 14:52
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