[Glossary](https://blnkfinance.com/glossary) Yield curve # What is a yield curve? Yield curve A yield curve plots the yields of similar debt against time to maturity. Most people mean the Treasury curve. A rising curve is normal: longer loans pay more. A falling curve is inverted and often read as a recession signal. The curve is market data. It is not a ledger object. ## How does a yield curve work? You take bonds of the same credit, usually government bonds, and plot yield on the vertical axis and maturity on the horizontal. The line through those points is the curve. Traders read its shape more than any single point. | Shape | What it says | | --- | --- | | Normal | Longer maturities yield more | | Flat | Little extra pay for time | | Inverted | Short rates sit above long rates | ## Yield curve vs a single yield One yield is a point. The curve is the set of points. A loan priced “off the curve” picks the point that matches its tenor, then adds a spread. If you only store one rate, you cannot explain why a two-year facility and a ten-year facility pay different amounts. ## What the curve does not do It does not post interest. It does not settle a bond. It is an input to those jobs. When the curve moves, existing positions change value. New originations change price. The cash still moves on the schedule you already wrote. ## How it works with Blnk Blnk does not store a yield curve. Keep the curve in the system that prices the product. When you have a rate, use it to size the interest post, then record that amount. Put the tenor and the rate you used in metadata on the transaction so you can see later which point on the curve produced the charge. The post itself is the same source-to-destination transfer as any other interest movement. See [yield](https://blnkfinance.com/glossary/yield). Related terms - [Yield](https://blnkfinance.com/glossary/yield) - [Zero-coupon bond](https://blnkfinance.com/glossary/zero-coupon-bond) - [Ledger](https://blnkfinance.com/glossary/ledger)