Pulse of the economy

“In many ways the yield curve reflects the “pulse of the economy,” signalling what is going on at a fundamental level. Thus, changes in the yield curve can provide bond investors with important insights that can be used to determine which bonds to include in their portfolios. For stock investors, the curve can be used as part of the macroeconomic analysis to help forecast changes in the economic outlook, which of course, directly impacts most company’s sales and earnings, and therefore their stock prices.”

Excerpt From: Pike, William. “Why Stocks Go Up and Down.”