This week, the world's three major central banks - the Bank of Japan, the Federal Reserve and the Bank of England - will announce their monetary policy decisions one after another, and the market is full of expectations and speculation.
The Bank of Japan is expected to announce its policy direction on Wednesday (Tuesday evening US time). Given that Japan's inflation rate continues to be higher than the central bank's target and the yen exchange rate remains sluggish, the market is generally concerned about whether the Bank of Japan will raise its policy interest rate or send a signal of a rate hike. However, there is also a view that raising interest rates may indirectly reduce the price of imported goods and stimulate consumption by boosting the yen.
Immediately afterwards, the Federal Reserve will announce its policy decision on Wednesday afternoon (Eastern Time). Although the market generally does not expect the Fed to cut interest rates immediately, the market generally predicts that the Fed will indicate that it will take interest rate cut measures at its mid-September meeting. The forecast of the FedWatch tool shows that a September rate cut is almost a foregone conclusion, and there is a small probability of a larger rate cut.
Finally, the Bank of England will announce its policy decision early Thursday afternoon. The market has different views on whether the Bank of England will break the policy norm in recent years. However, even if the central bank chooses to cut interest rates, the market expects it to take a very cautious stance and avoid giving the market the impression that it will adopt a series of easing policies.
Against the backdrop of increasing global economic uncertainty, the policy decisions of these central banks will have a profound impact on the direction of the global economy. Market participants are closely watching these developments to adjust their investment and economic expectations.
