Key Points
Frankfurt | Washington: The world's biggest central banks are on the starting line of reversing a record string of interest rate hikes but the way down for borrowing costs will look very different from the way up...
Instead, banks on opposite sides of the Atlantic are likely to move in the smallest increments with periodic pauses, fearing that ultra-low unemployment could rekindle inflation rates still above their targets...
The eventual bottom for interest rates is also set to be far higher than the historic lows of the last decade and mega-shifts in the structure of the global economy could put borrowing costs on a higher path for years to come...
Central banks started to jack up rates from late 2021 as post-pandemic supply constraints and surging energy prices on Russia's war in Ukraine sent inflation into double-digit territory across much of the world..
You might be interested in
Higher for longer: Why are central banks keeping interest rates elevated?
06, Nov, 23During the Covid crisis, governments and central banks slashed interest rates and pumped in huge amounts of money to revive their economies. But as activity resumed and pent-up demand burst out, the excess money caused high inflation, which has stubbornly refused to return to official targets.
With inflation knife still hanging over central banks, will value stocks find favour on Dalal Street?
06, Oct, 23While major central banks are signalling a peaking of their rate hike cycle, there are indications that the tight monetary policy stance could persist for longer than anticipated earlier
Central banks 'not out of the woods' in inflation battle - BIS
04, Dec, 23Global central bank umbrella body, the BIS, eased its hardline stance on inflation on Monday, calling recent progress encouraging, but stressed that central banks were not out of the woods yet.
Global central banks keep up inflation fight in March
03, Apr, 23The pace of interest rate hikes by major developed and emerging market central banks continued at a healthy clip in March though the scale of rises tapered off somewhat as turmoil in the banking sector clouded the outlook for global growth.
The world’s central banks are treading cautiously into 2024. Here’s why
24, Dec, 23Some of the world’s major central banks–such as US Federal Reserve & European Central Bank–are likely to avoid drama in their last set of meetings for 2023.
UK economy shows strains and gains, complicating BoE's job
12, Jul, 23Britain's economy is showing some signs of strain from the Bank of England's 13 back-to-back interest rate increases, but the jobs market is still generating inflationary heat and consumers have not reined in their spending sharply.
DM central banks still hawkish, but EMs set to lead global rate cutting cycle
29, Jun, 23EMs have managed to tame the inflation beast to a considerable extent. However, there are some downside risks which can revive inflationary pressures
Behind RBI’s repo rate pause: Slump in consumption, tepid private investment
06, Apr, 23This also assumes significance given that many global agencies have lowered India’s growth forecast for 2023-24 amid expectations of global economic slowdown and monetary tightening by other countries across the Atlantic.