Stocks are at record highs, the job market is booming and fears about China’s deadly coronavirus have eased on Wall Street. The bond market, however, is again flashing a potential warning signal for the global economy. 

A sharp rally in Treasurys in recent weeks led parts of the U.S. yield curve to invert, a signal that is often a harbinger of a recession. An inverted yield curve happens when shorter-term bond yields climb above longer-term ones. Investors flocked to safe-haven assets like Treasurys recently on fears that the virus could hinder global growth, sending long-term yields lower.

That’s left some investors scratching their heads as the American consumer—the pillar of the U.S. economy—remains strong while the U.S. economy is in the midst of its longest expansion on record.

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