Eurozone: Inflation will be higher in the future than the 2.2% average between 2002 and 2007 – Natixis

FXStreet Insights Team FXStreet

Inflation in the Eurozone will be higher in the future than between 2002 and 2007 – when averaged 2.2%, analysts at Natixis say.

Medium-term inflation will determine the level of nominal and real interest rates

Average inflation in the Eurozone over the 2002-2007 period was 2.2%. We have seen the factors that will give rise to higher inflation in the future than between 2002 and 2007: higher energy prices, a tighter labour market, declining productivity gains, and a dominant regime of excess demand, whereas the dominant regime from 2002 to 2007 was excess supply.

If inflation is higher in the medium term than 2.2% (2.7%, 3%), we can expect both short-term and long-term interest rates to be higher than between 2002 and 2007.

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD extends slide to fresh 2026-low near 1.3150

GBP/USD resumes its downside in the second half of the day on Wednesday and trades at its lowest level since November 2025 near 1.3150. The pair remains vulnerable amid a broadly firmer US Dollar and chaotic UK political environment. The focus is now on BoE-speak for further trading impetus.

EUR/USD slumps to new yearly low below 1.1350

EUR/USD stays under bearish pressure and trades at its lowest level in a year below 1.1350 on Wednesday. The pair remains vulnerable to further declines amid a bullish US Dollar, which continues to draw support from hawkish Fed bets and US-Iran peace deal uncertainty.

Gold drops toward $4,000 on persistent USD strength

Gold remains under persistent selling pressure and trades below $4,050 on Wednesday, losing more than 1.5% on the day. Hawkish Fed prising, broad-based US Dollar strength and the uncertainty surrounding the US-Iran peace agreement make it difficult for the precious metal to find a foothold.

Dogecoin tests a key make-or-break point amid waning retail support

Dogecoin trades below $0.08000 maintaining a steady decline for the seventh straight week. The meme coin is losing its retail strength as DOGE futures Open Interest drops 10% in 24 hours, while institutional demand remains muted with zero inflows so far this week.

Tech rout weighs on US stocks as the USD clocks a fresh 2026 high

Major US equity benchmarks ended Tuesday’s session considerably in the red, with the Nasdaq 100 down 3.3%, the S&P 500 off by 1.4%, and the Dow Jones down 0.1%. Stocks were largely weighed down by tech amid doubts over the AI-driven rally; the Philadelphia Semiconductor Index slid nearly 8%.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.