Anjali Sharma
GG News Bureau
NEW YORK, 12th Dec. US Federal Reserve Bank the world’s largest central banks on Monday poised to keep interest rates on hold this week amid concerns over stubbornly high inflation, despite growing expectations for sharp cuts in borrowing costs next year, according to media reports.
US Federal Reserve, Bank of England (BoE) and European Central Bank are expected to keep interest rates at their current restrictively high levels to ensure inflation continues to fall back from the highest levels in decades, The Guardian reported.
The report said that the financial markets expect interest rates to be cut next year amid cooling inflation and as high borrowing costs weigh on economic growth, raising the prospect of recessions on both sides of the Atlantic before key elections.
Raphael Olszyna-Marzys, an international economist at J Safra Sarasin Sustainable Asset Management said that “Their core message is likely to be similar. Good progress has been made towards reducing inflation, but they cannot afford to be complacent.”
The reports added that trading in financial markets reflects the probability of up to 1.4 percentage points of cuts by the Fed and the ECB by the end of 2024, according to the investment bank Nomura, while expectations have intensified for the BoE to cut rates by nearly one percentage point.
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