This has seen the yield curve progressively flatten and become negatively-sloped during the past few years.
4  8  “Globalisation and Monetary Policy”, March 2007  BIS Review 25/2007  Figure 11: The change in the yield curve since the beginning of the tightening cycle  Source: Bloomberg  Figure 12: New Zealand and US long term interest rates  Source: Bloomberg  A negatively-sloped yield curve has encouraged borrowers to take out term loans at relatively lower rates.