High US CPI data delivered another blow to any hopes of quick rate cuts, at least by the Fed, while the ECB continues to march towards a June cut. Longer out, we find good arguments of why the level of rates may have risen for good. “Protracted reversals in real interest rates have occurred repeatedly in history in the aftermath of large economic, political or social shocks. We may now be facing such a turning point.” – Isabel Schnabel, Member of the ECB’s Executive Board on 20 March 2024. Rate cut expectations have been pushed further into the future, especially for US rates, which surged higher following another ... (full story)