"Central Banks' Coordinated Rate Cuts Signal Major Inflation Reversal"

Major central banks are beginning to reverse the record string of interest rate hikes in response to post-pandemic supply constraints and surging energy prices. The approach will involve small increments and periodic pauses, with the eventual bottom for interest rates expected to be higher than historic lows. The U.S. Federal Reserve may be an outlier, as the economy is strong and the Fed may need to navigate the impact of the upcoming election. Meanwhile, Europe continues to struggle, with Germany in recession and Britain barely growing. Policymakers are confident that ultra-low rates will not be revisited, and there is a belief that the global economy is undergoing profound changes that could reverse the historic downtrend in the neutral rate of interest.