Central Banks Set for Higher for Longer to Fight Inflation

  • First up will be the ECB, whose policymakers face a knife-edge decision on Thursday on whether to keep raising rates or enact a pause.
  • Next Wednesday, the Fed will take center stage. Officials there are turning more optimistic that they can quash inflation without causing serious economic pain.
  • The Bank of England is expected to raise rates a quarter point on Sept 21.
  • Compared to many of its peers the Swiss National Bank is in a much more comfortable position. With inflation below its 2% ceiling, it may not be forced to raise rates next Thursday.
  • The same day as the SNB, Norges Bank in Norway is expected by investors to end rate hikes with a final quarter-point increase in rates. Sweden’s Riksbank, scheduled for then too, may hike borrowing costs again as well.
  • In Japan, there’s a growing sense that new Governor Kazuo Ueda is paving the way for an eventual normalization of policy.