Inflation expectations are increasing in US breakeven rates and eurozone swap rates, influenced by recent statements from President Trump. Oil prices have stabilized alongside reduced anxiety in risk assets, yet concerns persist over widening spreads. Analysts highlight these trends as problematic amid ongoing economic conflicts.
On March 11, 2026, financial analysts at Seeking Alpha reported rising inflation expectations in key markets. President Trump's words from the previous Monday continue to echo, reverberating into a backdrop of persistent economic tensions described as a 'vacuum of ongoing conflict.'
In the US, breakeven inflation rates and swap spreads are widening, signaling heightened inflationary pressures. The report notes that while oil prices have calmed and angst over material risk assets has eased, these developments in rates are 'not great.' Specifically, wider front-end breakevens and back-end swap spreads are identified as 'problem childs' in the current environment.
Across the Atlantic, the eurozone's 10-year swap rate is approaching the 3% level, driven by similar pushes from inflation expectations. This trend underscores a broader unease in fixed-income markets.
The analysis comes from Padhraic Garvey, CFA, Regional Head of Research, Americas; Michiel Tukker, Senior European Rates Strategist; and Benjamin Schroeder, Senior Rates Strategist. Their commentary emphasizes the interplay between geopolitical rhetoric and market dynamics, without delving into specific policy outcomes.
