Term Premium on a 1 Year Zero Coupon Bond
THREEFYTP1 • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
0.05
Year-over-Year Change
-38.96%
Date Range
10/4/2021 - 8/1/2025
Summary
The Term Premium on a 1 Year Zero Coupon Bond measures the additional yield investors require to hold a longer-term bond compared to a shorter-term bond. This is an important indicator of market expectations and risk aversion.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
The Term Premium represents the extra return investors demand to hold a longer-maturity bond instead of repeatedly rolling over shorter-maturity bonds. This metric provides insight into fixed income market dynamics and investor sentiment.
Methodology
The data is calculated by the Federal Reserve based on the yield curve and models of bond market pricing.
Historical Context
Economists and policymakers monitor term premiums to gauge market conditions and inflation expectations.
Key Facts
- The term premium is typically positive, reflecting investor risk aversion.
- Term premiums tend to rise when the economic outlook becomes more uncertain.
- Declining term premiums can signal falling inflation expectations.
FAQs
Q: What does this economic trend measure?
A: The Term Premium on a 1 Year Zero Coupon Bond measures the extra yield that investors require to hold a longer-term bond compared to a shorter-term bond.
Q: Why is this trend relevant for users or analysts?
A: This metric provides insight into fixed income market dynamics, investor risk preferences, and inflation expectations, which are relevant for economists, policymakers, and financial market participants.
Q: How is this data collected or calculated?
A: The data is calculated by the Federal Reserve based on the yield curve and models of bond market pricing.
Q: How is this trend used in economic policy?
A: Policymakers and economists monitor term premiums to gauge market conditions and inflation expectations, which can inform monetary policy decisions.
Q: Are there update delays or limitations?
A: The term premium data is published regularly by the Federal Reserve with minimal delay, providing timely insights into fixed income market dynamics.
Related Trends
Fitted Instantaneous Forward Rate 10 Years Hence
THREEFF10
Instantaneous Forward Term Premium 8 Years Hence
THREEFFTP8
Instantaneous Forward Term Premium 1 Year Hence
THREEFFTP1
Instantaneous Forward Term Premium 5 Years Hence
THREEFFTP5
Fitted Instantaneous Forward Rate 7 Years Hence
THREEFF7
Instantaneous Forward Term Premium 7 Years Hence
THREEFFTP7
Citation
U.S. Federal Reserve, Term Premium on a 1 Year Zero Coupon Bond (THREEFYTP1), retrieved from FRED.