Learning, Equilibrium Trend, Cycle, and Spread in Bond Yields Staff working paper 2020-14 Guihai Zhao This equilibrium model explains the trend in long-term yields and business-cycle movements in short-term yields and yield spreads. The less-frequent inverted yield curves (and less-frequent recessions) after the 1990s are due to recent secular stagnation and procyclical inflation expectations. Content Type(s): Staff research, Staff working papers JEL Code(s): E, E4, E43, G, G0, G00, G1, G12 Research Theme(s): Financial markets and funds management, Market functioning, Models and tools, Economic models, Monetary policy, Inflation dynamics and pressures, Monetary policy framework and transmission