Business and Personal Finance Dictionary

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• POSITIVE YIELD CURVE
  
  When the interest rate on a long-term bond is higher than the interest rate on a shorter-term bond of the same quality, the relationship between the two, called the yield curve, is positive. That's the norm, since if you're tying up your money for an extended period, you want to earn more than someone who is investing for just a few months. When the reverse is true, and interest rates on short-term investments are higher than the rates on long-term investments, the yield is negative, or inverted. That typically occurs if inflation spikes after a period of relatively stable growth.
  
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