Bank of England Governor Andrew Bailey hinted that the UK might be able to lower interest rates before the US, saying inflation dynamics in the two economies are diverging. Bailey said on Tuesday that there is more "demand-led inflation pressure" in the US than seen in the UK after markets were spooked by surprisingly strong price data in America last week. He said there is "strong evidence" of UK price pressures retreating. "The dynamics of inflation are rather different between Europe — I mean Europe geographically now — and in the US," he said in an interview with the...
The Federal Reserve raised interest rates by a quarter of a percentage point on Wednesday, citing still elevated inflation as a rationale for what is now the highest U.S. central bank policy rate in 16 years. The rate hike, the Fed's 11th in its last 12 meetings, set the benchmark overnight interest rate in the 5.25%-5.50% range, and the accompanying policy statement left the door open to another increase. "The (Federal Open Market) Committee will continue to assess additional information and its implications for monetary policy," the Fed said in language that was little changed from its...
Australia's central bank decided to keep interest rates steady this month as policy was clearly restrictive and there was a risk a squeeze on household finances could lead to a sharp downturn and higher unemployment. However, the bank retained a warning that some tightening may still be required to bring inflation to heel, wary that the wider effects on inflation from higher rents, weak productivity and higher electricity prices had not been fully captured. Minutes of the July 4 policy meeting out on Tuesday showed the Reserve Bank of Australia's (RBA) board considered raising the cash...
Australian central bank Governor Philip Lowe said the rate-setting board will move to eight meetings a year from 11 now, beginning in 2024, while reiterating that policy may need to be tightened further. Four of the Reserve Bank's meetings will be on the first Tuesday of February, May, August and November, Lowe said in a speech in Brisbane on Wednesday. The exact dates for the other four will be published "soon," he added. The rate outcomes will be announced at 2.30 p.m. Sydney time as is the case currently. Among other changes decided by the board at its July...
Bank of England Governor Andrew Bailey said Britain's inflation rate is likely to drop "markedly" this year, and the full impact of interest rate increases has yet to hit the economy. The remarks released in a text of his speech at the Mansion House in London this evening indicate policy makers are growing more cautious about further increases in borrowing costs that are now at their highest since the global financial crisis in 2008. UK inflation has proved more persistent than other major economies, with the 8.7% headline rate more than four times the 2% target and the...
A united U.S. Federal Reserve agreed to hold interest rates steady at the June meeting as a way to buy time and assess whether further rate hikes would be needed, even as the vast bulk expected they would eventually need to tighten policy further, according to meeting minutes released on Wednesday. While "some participants" wanted to move ahead with a rate hike in June because progress in cooling inflation had been slow, "almost all participants judged it appropriate or acceptable to maintain" the federal funds rate at the existing 5% to 5.25%, the minutes said. "Most of those participants...
Federal Reserve Chair Jerome Powell said the central bank is prepared to tighten policy further if appropriate.
"We will make decisions about the extent of any additional policy and how...
Even before U.S. inflation data on Wednesday came in hotter than expected, Federal Reserve officials had begun worrying last month that progress might have stalled and a longer period of tight...