Report
Financial markets expect yield curves to be flat; they ignore factors that will lead to yield curves with a positive slope
Expected slopes of US and euro-zone yield curves at the end of 2024 and 2025 show that financial markets expect a virtually flat yield curve. We believe that this expectation is mistaken, since there are several factors that point to a yield curve with a positive slope at equilibrium, in particular: The persistence of inflationary pressures, which will lead to expectations of a periodic return of restrictive monetary policies , resulting in higher nominal long-term interest rates ; The significant need for investment linked to the energy transition, maintaining biodiversity and water management, leading to higher real long-term interest rates.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
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