By Alun John and Stefano Rebaudo LONDON/MILAN , July 30 The bond market selloff after this week’s Federal Reserve meeting highlights the challenge policymakers face as they grapple with what higher energy prices and the uncertain consequences of AI advances will mean for their…
onomies. The Fed left interest rates unchanged on Wednesday, even as chief Kevin Warsh pledged an unwavering commitment to bring inflation down, confusing traders and triggering heavy selling in longer-dated bonds
The Bank of England held rates steady on Thursday, and the Bank of Japan faces its own dilemma on Friday. Here’s where central banks in the Group of 10 developed economies stand, ranked from the highest policy rate to the lowest. 1/ AUSTRALIA The Reserve Bank of Australia has raised interest rates three times this year to 4.35%, the highest in the G10, fully reversing last year’s cuts. It now looks on hold for a while after Wednesday’s inflation data undershot forecasts, though the RBA chief says policy makers are prepared to raise rates again.
Markets see a further hike later this year as likely but not certain. 2/ NORWAY Norges Bank meets in mid-August. It’s already in hiking mode after a surprise move in May to curb inflationary pressures fuelled by the Iran war, but left rates unchanged at 4.25% last month. August is looking like a hold after core inflation slowed in June, helped by the short-lived decline in oil prices. 3/ BRITAIN The Bank of England kept interest rates on hold at 3.75%, as expected on Thursday, but a third of its nine ratesetters backed a hike.