In what can now safely be described as a plateau in interest rates, the Fed, European Central Bank and the Bank of England announced their decisions this week to stick the levels they’ve now been sitting at for a couple of months.
As this infographic shows, the U.S., UK and Eurozone had been on a strong upward coarse since early 2022 as central banks fought against rising inflation. Speaking on the U.S. decision, Fed chairman Jerome Powell said publicly for the first time that its rate “is likely at or near its peak for this tightening cycle.”
Expectations for the coming year of Members of the Federal Open Market Committee are currently pointing towards three 0.25 percentage point rate cuts in the U.S. in 2024. The Bank of England however, said upon its latest announcement that rates would need to stay high for “sufficiently long” in order to return inflation back to its 2% target.
This chart shows central banks’ main policy interest rates in selected countries/regions.
