[H8crilA]

Because the yield curve is priced into all assets. That's how you discount future corporate earnings to derive present value of the stock, for example.

An inverted yield curve means that there's a mistake in the market - people thought interest rates would be lower than the are. It means that assets are overpriced if this situation persists.

Also it is an indicator because it works :)

https://www.economist.com/graphic-detail/2019/07/27/yield-cu...