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📝 See Room For U.S.-EU Rate Spread Widening Further: Nordea

We recently listed reasons why the US economy is in a better shape compared to the Euro area, and we also think that the longer-term outlook for the US economy is brighter compared to the Euro area. This should also mean higher interest rates in the US longer out compared to the Euro area.

This is actually what the market is currently pricing. For the US, the market prices in a short rate of just below 4% in 10 years, while the corresponding rate for the Euro area is just above 3%. Earlier this year, these rates were much closer to each other. We actually see room for this spread to widen further, and the spread was much wider a few years ago.

- Nordea



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