From Quiver Quantitative:

Summary:
Financial markets are indicating that the era of near-zero interest rates may be over. In the U.S., rates are expected to drop to 3.75% by the end of 2024 and remain elevated for years. Factors such as inflation, government spending, and technological advancements like AI are contributing to this shift. Borrowers need to prepare for increased loan and refinancing costs. The neutral rate, which influences interest rate decisions, is believed to have increased, justifying the higher rates. Looking ahead, the long-term trend points to a new normal of higher borrowing costs, forcing businesses and individuals to adapt their financial planning. Public and private entities may face increased financial strain due to potential refinancing at higher rates.



Read more: Money Markets Predict Higher Interest Rates to Persist Beyond 2024