The difficulty of predicting long-term interest rates one year from now

Long-term interest rates will be subject to opposing forces (we are looking at the euro zone and the United States), which makes it difficult to predict them: We believe that inflation will rise, particularly as a result of the decline in productivity due to new health standards in companies. Financial markets are not at all expecting such a rise in inflation; the upward correction of inflation expectations will drive up interest rates; But we also believe that central banks will continue their massive purchases of public debt in 2021, given that the most important challenge is to support the economic recovery and that the inflation caused by the health standards is not real inflation (it is a temporary upward hike in prices); All things considered, we can expect a limited yield curve steepening. For there to be no steepening despite the expected rise in inflation, the Federal Reserve or the ECB would have to , like the Bank of Japan, switch to an objective of long-term interest rate stability, which seems unlikely for the Federal Reserve and impossible for the ECB.