In addition to the Federal Reserve, several other global central banks are in focus this week as they are expected to deliver policy decisions and address the economic fallout from the Middle East war.
“The supply shock is resulting in a market lowering growth expectations and increasing inflation expectations,” Capital analyst Kyle Rodda told my colleague Jake Conley. “That’s manifesting in doubts about future profitability and the path forward for global interest rates.”
Here’s an overview of at the major policy decisions unfolding this week:
Reserve Bank of Australia: The RBA raised the cash rate by 25 basis points to 4.1% on Tuesday as policymakers viewed the war in the Middle East as adding to inflation already deemed too high. For more details on the decision, read Yahoo Finance Australia’s coverage here.
Bank of Canada: Canada’s central bank is expected to continue to keep borrowing costs at 2.25% on Wednesday as the country navigates moderating growth and the renegotiation of the US-Mexico-Canada trade agreement, as well as the global oil shock.
European Central Bank: The ECB is expected to hold interest rates steady on Thursday, March 19, despite concerns of rising eurozone inflation. ECB policymakers are expected to offer assurances that the central bank won’t allow another inflation shock like the one experienced in 2022, when Russia invaded Ukraine.
The Bank of England: The BOE is also expected to keep interest rates unchanged at 3.75% on Thursday. Just two weeks ago, the United Kingdom’s central bank was expected to deliver its first of two interest rate cuts of the year, but that calculus changed after data released Friday showed economic growth stagnated in January.
Riksbank: Sweden’s central bank is expected to hold rates steady at 1.75% on Thursday.
Swiss National Bank: Switzerland’s policymakers are expected to keep rates unchanged at 0% on Thursday.