Central banks worldwide are responding differently to growing tariff risks, shaping a mixed outlook for interest rate policy.

Fed (U.S.) The Federal Reserve is in wait and see mode. Chair Jerome Powell warned tariffs could delay rate cuts. While Goldman Sachs sees a 50% chance of a September cut, others remain cautious.

ECB (Europe) Concerned about a strong euro hurting exports, the ECB may ease in September. ANZ expects a 25bps cut, citing weak growth.

BoE (UK) Balancing inflation and low growth, the BoE could start cutting in August. BofA predicts multiple cuts in H2 2025.

BoJ (Japan) Japan is less affected by tariffs, but exporters face pressure. A rate hike in October is still likely, per Capital Economics.

BoC (Canada) With recession risks rising, more rate cuts are expected. Capital Economics sees at least two more in 2025.

RBA (Australia) The RBA stays cautious. Despite cooling inflation, it’s holding off due to economic uncertainty.

As tariff threats cloud the global outlook, central banks are adjusting strategies based on local conditions and global trade shifts

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