The error in anticipating future inflation has not been corrected

In both the United States and the euro zone, expected future inflation in financial markets is lower in March 2024 than it was on average from 2002 to 2007. It is not surprising then that expectations of short-term and long-term interest rates remain lower than on average from 2002 to 2007. Financial market participants continue to ignore the impact on inflation of the energy transition, industrial reshoring, barriers to global trade, tight labour markets - particularly in the euro zone due to the decline in productivity - and the decline in productivity itself.