The Yield Curve for US Treasury Bonds today looks like this (taken from Statista.com):
The bond yield curve on a normal year: (Source:LKPP)
As you can see, the bond's interest rate gets higher as the time gets longer in a normal year, while the interest rate for the bond decreases as the time increases for the 2023 curve. This is called an inversion of the yield curve. It means interest rates in the short term are higher than long-term rates.
Why does this happen? The nominal interest rate of a bond is related to its risk and the expected inflation. The higher yield means the short-term risk or inflationary expectations are higher than the long-term. This shows that investors are more worried about the short run than the long run.
The inverted yield curve can indicate a recession because as borrowing becomes more expensive in the short term, investment probably will decrease.
The deeply inverted yield curve surprisingly supports the case for a deep recession and a mild one at the same time. Some argue that the yield curve is inverted as a deep recession will happen and the Fed will have to ease quickly, and some argue we'll have a mild recession and the Fed will be able to ease more quickly than expected.
Thus, an inverted yield curve tells us the short-term concerns about the economy are worse than the long-run concerns and that a recession is probably coming, but it really does not say anything about the magnitude of a recession.
Also, the inversion might get deeper in the following days, as the US economy moves closer to the Treasury's default deadline, and the short-term bond yields get even higher.
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