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November 9, 2023

The normalization of US interest rates

A closer look at US nominal interest rates over the last 2 centuries confirms that the current bond yields represent a “normalization” as they are now back to the long term historical average. There remains a risk they could go higher if inflation becomes sticky and taking into account structural factors like the high sovereign debt levels of the US, the eldering population and the de-dollarization of the world.