The flattening of the US yield curve during the past couple of sessions is noteworthy. The 10s-30s segment of the curve is especially interesting, because it has traded in two quite distinct regimes during the past 15 months. Between January and June 2017, 10- and 30-year yields showed a straight-line relationship, and again between December 2017 and March 2018 (albeit with a much narrower differential). Between June and December the relationship was unstable.

10s-30s flatterner after Trump tax cut

The June-December period included debate over and enactment of the Trump tax cuts. What the 10s-30s spread appears to be telling us is that the tax cuts will have more of short-term than a long-term impact on growth.

That explanation seems more plausible when we look at real yields and breakeven inflation separately. The shift from a flatter to a steeper regime is quite pronounced in TIPS:

Two curve regimes

It is much less pronounced in breakevens, which show a very distinct shift from one regime to another, albeit a much smaller one:

Shift in Breakevens

It would make sense that the market would expect the tax cuts to have an impact on real yields more than on breakevens, and expect that effect to be front-loaded.