Crown Castle Inc. (CCI) Stock Forecasts

Summary

The yield curve has been inverted for months now. But what has changed over the past year is that the inversion isn’t so steep. Back in April 2023, 2-year Treasury Note yields were about 100 basis points above 10-year yields. Now the gap is 35 basis points. There are a couple of reasons for this change, and in our view they point toward an upcoming shift to a normal upward-sloping curve in the next few quarters. First, U.S. economic trends have been positive. Fixed-income investors have moved away from fears of deflation and are now again seeking a premium in yields versus inflation. That has lifted rates across the yield curve. Second, the Federal Reserve finally is in front of the inflation curve. The central bank is now building a cushion, or a gap, between fed funds and core PCE in order to push inflation back toward 2.0%. This is all well and good — but if the Fed’s gap is too wide for too long, the central bank risks tipping the economy into a recession (which is allegedly what the inverted yield curve is signaling). Fed Chairman Jerome Powell has explained to financial markets that he and his colleagues want to continue fighting stubborn inflation, so they are likely to keep short-term rates high for a period of time, which is where the markets are now. But the day