Term Premium on a 8 Year Zero Coupon Bond
THREEFYTP8 • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
0.30
Year-over-Year Change
-23.63%
Date Range
10/4/2021 - 8/1/2025
Summary
The Term Premium on an 8 Year Zero Coupon Bond measures the additional yield investors demand for holding longer-term fixed-income securities. This metric is closely watched by economists and policymakers to gauge market risk sentiment and inflation expectations.
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 that investors require to hold a longer-maturity bond versus a series of shorter-term bonds. It reflects uncertainty about future interest rates and macroeconomic conditions. Analyzing term premiums provides insights into market views on monetary policy and economic growth.
Methodology
The data is derived from the yield curve and calculated using a no-arbitrage, affine term structure model.
Historical Context
The term premium is a key input for Federal Reserve interest rate decisions and portfolio management by fixed-income investors.
Key Facts
- The term premium averaged 1.5% from 1990-2022.
- A rising term premium signals increased market risk aversion.
- Negative term premiums indicate investor preference for longer-dated bonds.
FAQs
Q: What does this economic trend measure?
A: The Term Premium on an 8 Year Zero Coupon Bond measures the additional yield that investors demand for holding longer-term fixed-income securities compared to a series of shorter-term bonds.
Q: Why is this trend relevant for users or analysts?
A: The term premium provides insights into market expectations for future interest rates, inflation, and economic growth, making it a key input for monetary policy decisions and fixed-income portfolio management.
Q: How is this data collected or calculated?
A: The data is derived from the yield curve and calculated using a no-arbitrage, affine term structure model.
Q: How is this trend used in economic policy?
A: The term premium is closely monitored by the Federal Reserve and other policymakers to gauge market sentiment and inform interest rate decisions.
Q: Are there update delays or limitations?
A: The data is published with a lag and may be subject to revisions. Additionally, the term premium can be sensitive to modeling assumptions and data inputs.
Similar THREEFYTP Trends
Term Premium on a 1 Year Zero Coupon Bond
THREEFYTP1
Fitted Yield on a 10 Year Zero Coupon Bond
THREEFY10
Fitted Instantaneous Forward Rate 1 Year Hence
THREEFF1
Fitted Instantaneous Forward Rate 5 Years Hence
THREEFF5
Instantaneous Forward Term Premium 5 Years Hence
THREEFFTP5
Term Premium on a 6 Year Zero Coupon Bond
THREEFYTP6
Citation
U.S. Federal Reserve, Term Premium on a 8 Year Zero Coupon Bond (THREEFYTP8), retrieved from FRED.