Global rate-hike cycle in view as central banks take on inflation
FRANKFURT — The prospect of a new global interest rate-tightening cycle is coming into view as some of the world's top central banks raise rates and signal more may be needed to tame inflation fuelled by the Iran war. Key rates are already much higher than the rock-bottom levels from the last hiking cycle that began in 2022. But central bankers are under market pressure to show that they are prepared to raise them further to tame inflation expectations and rein in long-term bond yields at multidecade highs. The Bank of Japan became the latest big central bank to tighten on Friday, following rate increases by the Federal Reserve two days before and the European Central Bank last week. The Bank of England left rates unchanged this week but flagged that inflation pressures could require further action. "Our policy phase has changed," BOJ Governor Kazuo Ueda said as the bank signalled it was prepared to keep pushing up borrowing costs. The moves, while formally independent of each other, reflect a shared concern among policymakers that higher oil and gas costs resulting from the Iran war ra
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