The yield curve is one of the most important benchmarks and indicators of the financial market. It indicates the interest rate of a risk-free zero-coupon bond as a function of its maturity. Thus, the yield curve represents the return on a financial investment in a risk-free bond. It is also used to evaluate various financial products.
A change in the yield curve over time can have an impact on investment strategies and the value of financial products. A good forecast of the future yield curve is therefore useful for portfolio and risk management.