Sahm Rule vs Yield Curve (2s10s)
Which is the better recession indicator — Sahm Rule or 2s10s yield curve?
One-year comparison
Left axis: Sahm Rule (green) · Right axis: Yield Curve 2s10s (blue)
The analysis
These are the two most-cited recession indicators in modern macro writing. The 2s10s yield curve inverts typically 12-18 months before a recession and has the longer historical lead time. The Sahm Rule, based on the unemployment rate's rise from its 12-month low, triggers closer to the recession itself but has had a cleaner track record (no false positives until 2024's revision-driven trigger). Use them together: 2s10s for early warning, Sahm Rule for confirmation.
Track the Sahm Rule in real time. Current value, historical chart, and AI analysis. The Sahm Rule has correctly signaled every US recession since 1970.
Monitor the 2-year/10-year Treasury yield curve spread in real time. Yield curve inversions have preceded every US recession since 1955.