Dear friends and colleagues:
The CFR Global Monetary Policy Tracker is updated through March 5.
With geopolitics as dangerous and volatile as it has been in some time, monetary policy has been an eerie beacon of stability. Since last month’s update, all the major reserve-currency issuing central banks have held their policy rates steady: the Fed at 3.63%, the ECB at 2%, the PBoC at 3%, the BoJ at 0.75%, the BoE at 3.75%, the Bank of Canada at 2.25%, and the Reserve Bank of Australia at 3.85%. Our CFR Index of Global Easing (-)/ Tightening (+) remains at -5.65/10, indicating moderately significant easing.
War in the Middle East creates a conundrum for central banks targeting both inflation and output growth, as it pushes up energy prices while weighing on demand and employment. Markets currently assign a 97% probability that the Fed will make no rate move at its March 18 meeting.
Please be sure also to check out our CFR Global Inflation Tracker, which covers nearly 200 countries over the past quarter century.
Sincerely,
