Beautiful Virgin Islands

Wednesday, Aug 27, 2025

Charting the global economy: Central banks step up tightening

Charting the global economy: Central banks step up tightening

More central banks around the world are unleashing a greater amount of policy firepower as they seek to combat unrelenting inflationary pressures.

Half percentage-point increases in interest rates are becoming more common, as seen in India and Australia this week. United States Federal Reserve officials next week are forecast to raise rates by 50 basis points as data showed a fresh four-decade-high rate of inflation.

The European Central Bank, however, is taking a more measured approach -- at least in the near-term. Against a backdrop of soft economic activity, officials this week indicated they would boost rates a quarter point in July.

Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:

World


India and Australia both increased interest rates by a half point this week, joining more than 50 central banks that have hiked borrowing costs by at least such an increment in one go this year. Chile, Poland and Peru -- already part of that club -- also hiked again. Meanwhile, Russia went the other way, lowering rates to the level they were at before the invasion of Ukraine.

The world economy will pay a “hefty price” for the war in Ukraine encompassing weaker growth, stronger inflation and potentially long-lasting damage to supply chains, the Organisation for Economic Co-operation and Development (OECD) said. The organisation slashed its outlook for global growth this year to 3% from the 4.5% it predicted in December and doubled its inflation projection to nearly 9% for its 38 member countries. In 2023, it expects growth to slow to 2.8%.

Three of the key supply-side factors driving today’s global inflation levels have already turned around, meaning relief could be on the horizon for shoppers worldwide.

US


US inflation accelerated to a fresh 40-year high in May, indicating price pressures are becoming entrenched in the economy and shattering consumer confidence. The latest government inflation figures will likely push the Federal Reserve to extend an aggressive series of interest-rate hikes into the fall.

For the first time in two months, the Port of Los Angeles expects inbound container volumes will exceed year-earlier levels. It is too soon to say whether this is a blip or the start of a bigger wave of goods from Asia, but these numbers will be closely watched as the busiest US turnstile for trade edges closer to crunch time.

Gasoline reached US$5 a gallon or more in over a dozen US states a week into the peak summer travel season, as stockpiles of the fuel remain tight. At this rate, JPMorgan Chase & Co.’s prediction of $6.2 gallon gasoline by August seems well within reach.

Europe


The European Central Bank committed to a quarter-point increase in interest rates next month and opened the door to a bigger hike in the fall as it confronts record inflation. With fresh forecasts signalling a faster path for euro-zone prices than previously thought, it will cease large-scale asset purchases on July 1.

German factory orders unexpectedly sank in April as harsh lockdowns in China pressured global supply chains, adding to disruptions caused by Russia’s invasion of Ukraine.

Russian efforts to rewire trade flows and bypass sanctions for the war in Ukraine can’t make up for the collapse in imports that’s crippling its economy. One stark result so far: For the first time, Belarus, a neighbouring country that Russia used to help stage the invasion, in April leapfrogged Germany -- an economy more than 60 times bigger -- by the value of imports to Russia, according to a Bloomberg analysis of the latest data.

Asia


Bank of Japan Governor Haruhiko Kuroda pointed to some positive changes that suggest progress is being made toward his stable inflation target while making clear that policy tightening still isn’t an option for now. Several data sets are showing rising inflation expectations and a higher tolerance for price increases among households, the governor said in a speech Monday.

Thailand’s retail inflation quickened in May to its highest in nearly 14 years, a level that may test the central bank’s resolve to stand pat on borrowing costs. Consumer prices rose 7.1% from a year earlier, accelerating from 4.7% a month ago, official data showed Monday.

Emerging markets


Brazil analysts jacked up their inflation expectations for this year and next, before the central bank meets to discuss an extension of its aggressive cycle of interest rate hikes. Consumer prices will hit 8.89% in December, according to a central bank survey published on Monday, higher than the last forecast of 7.89% from May 2.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Spotify’s Strange Move: The Feature Nobody Asked For – Returns
Manhunt in Australia: Armed Anti-Government Suspect Kills Police Officers Sent to Arrest Him
China Launches World’s Most Powerful Neutrino Detector
How Beijing-Linked Networks Shape Elections in New York City
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
2 Australian Police Shot Dead In Encounter In Rural Victoria State
Vietnam Evacuates Hundreds of Thousands as Typhoon Kajiki Strikes; China’s Sanya Shuts Down
UK Government Delays Decision on China’s Proposed London Embassy Amid Concerns Over Redacted Plans
A 150-Year Tradition to Be Abolished? Uproar Over the Popular Central Park Attraction
A new faith called Robotheism claims artificial intelligence isn’t just smart but actually God itself
Deputy Prime Minister Angela Rayner Purchases Third Property Amid Housing Tax Reforms Debate
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Italian Facebook Group Sharing Intimate Images Without Consent Shut Down Amid Police Investigation
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
Sam Nicoresti becomes first transgender comedian to win Edinburgh Comedy Award
Builders uncover historic human remains in Lancashire house renovation
Australia Wants to Tax Your Empty Bedrooms
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
FBI Investigates John Bolton Over Classified Documents in High-Profile Raids
Report reveals OpenAI pitched national ChatGPT Plus subscription to UK ministers
Labour set to freeze income tax thresholds in long-term 'stealth' tax raid
Coca‑Cola explores sale of Costa coffee chain
Trial hears dog walker was chased and fatally stabbed by trio
Restaurateur resigns from government hospitality council over tax criticism
Spanish City funfair shut after serious ride injury
Suspected arson at Ilford restaurant leaves three in critical condition
Tottenham beat Manchester City to go top of Premier League
Bank holiday heatwave to hit 30°C before remnants of Hurricane Erin arrive
UK to deploy immigration advisers to West Africa to block fake visas
Nurse who raped woman continued working for a year despite police alert
Drought forces closures of England’s canal routes, canceling boat holidays
Sweet tooth scents: food-inspired perfumes surge as weight-loss drugs suppress appetites
Experts warn Britain dangerously reliant on imported food
Family of Notting Hill Carnival murder victim call event unmanageable
Bunkers, Billions and Apocalypse: The Secret Compounds of Zuckerberg and the Tech Giants
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
New York Appeals Court Voids Nearly $500 Million Civil Fraud Penalty Against Trump While Upholding Fraud Liability
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
Child-free hotels spark controversy
North Korea is where this 95-year-old wants to die. South Korea won’t let him go. Is this our ally or a human rights enemy?
Hong Kong Launches Regulatory Regime and Trials for HKD-Backed Stablecoins
China rehearses September 3 Victory Day parade as imagery points to ‘loyal wingman’ FH-97 family presence
×