An inverted yield curve is a financial phenomenon in which short-term debt instruments have higher yields than long-term debt instruments. It occurs when the yields on securities with a longer maturity rate are lower than those of the same quality but with a shorter maturity rate. In an inverted yield curve, investors are willing to accept a lower return for investing their money over a longer period of time. This behavior suggests that they expect economic conditions to worsen in the future, as investors usually demand a higher return for lending money for longer periods of time. The inverted yield curve is used as an indicator for recessionary periods.