Central banks worldwide are adopting a wait-and-see approach this week as they assess the economic impact of Donald Trump’s trade policies. With tariffs on steel and aluminum now in place and tensions rising with Canada, China, and the EU, policymakers face growing uncertainty.
📌 Key Highlights:
- Rate Decisions: The Federal Reserve, Bank of England, and Bank of Japan are expected to hold interest rates steady.
- Economic Uncertainty: Central banks are weighing whether the trade turmoil will impact growth or inflation more significantly.
- Global Response: Some nations, like Brazil, are likely to raise borrowing costs to combat inflation.
- Fed’s Dilemma: The US Federal Reserve faces pressure to cut rates, but rising inflation expectations may limit its options.
European Central Bank President Christine Lagarde noted that the job of monetary policymakers has become more complex, given the unpredictable trade environment.