1940-2020: The Full Interest Rate Cycle
Reasonable assumption on interest rates should be done based on relative or comparable starting points. With interest rates at secular lows, we should only compare rate activity from the 1940 to 1980 period which was a secular rising trend while avoid comparing rate activity to the 1980 to 2008 period.
Fastest Rate Increase, From the Low
Below we compare the rate increase of the 3-Month Treasury from the secular low in 1940 at 0.01% to the rate increases from the 2011 low at 0.01%.
From the level of 0.01% to 2.39%, the rate of increase was exaggerated for the period from 2011 to 2019 compared to the period of 1940 to 1956. The currently level of volatility is not unexpected for the early phase of the secular rising rate trend.