Via the @FT, my thoughts on why central bank rate hikes should not be “the only game in town” when it comes to addressing today's inflation challenge. The real remedies lie not with central banks but with governments: addressing supply bottlenecks and pursuing greater fiscal consolidation (which would also ease pressure on long-run yields by creating more room for the funding of innovations). #economy# #markets# #centralbanks# #inflation#

Good morning The signaling accompanying the Bank of Japan's rate hike sent the Yen weaker: In a widely expected move, Japan’s central bank raised interest rates by 25 basis points to their highest level since 1995. Yet, as the signaling regarding future hikes disappointed markets, the Yen depreciated more than 1%, continuing to unwind gains sparked by (actual and anticipated) FX intervention. (CNBC chart below). #economy# #markets# j #japan# #boj# #centralbanks#

The Bank of England is the exception this time around: In a 6–3 vote by its Monetary Policy Committee, the Bank held interest rates steady at 3.75%. With the Bank of Japan expected to hike tomorrow, and both the Federal Reserve and the European Central Bank having already raised rates, the BoE is alone among the major central banks in holding off this month. #economy# #markets# #centralbanks# #bankofengland#

Good morning. UK inflation climbed to 3.1% in August on higher energy prices, while core inflation remained unchanged at 2.6%. Matching consensus forecasts, the data leaves the Bank of England’s Monetary Policy Committee facing a delicate balance ahead of tomorrow's rate decision: push against against a headline rate back at 3% for the first time since March on worries that it may spill into core, or hold off because core is contained? (Markets are pricing in an 80% probability of a hold.) #economy# #markets# #centralbanks# @bankofengland

The ECB decides today. But the real question isn't just what they do — it's how every major central bank responds to an energy shock none of them saw coming. Günter Grimm @GFXFTs and Beat Nussbaumer @MacrobeatL join LiveSquawk Market Talk to set up the decision, the connotations, and what it means for the BoE and FOMC next. Episode dropping ahead of the announcement. Don't miss it. 🎧 YouTube: 🎧 Spotify: #ECB# #CentralBanks# #EnergyShock# #Macro# #LiveSquawk#

Staying on the topic of interest rates, this from Bloomberg on market expectations for central bank policies: "Traders see borrowing costs rising faster in Japan, Canada, the euro zone and the UK than in the US over the next year. Of the 32 swap markets tracked by Bloomberg, two-thirds are priced for rate hikes, with South Korea leading the pack at more than 100 basis points. It marks a shift from the Fed-dominated rate cycle of recent years." More to follow on the "why" and the "so what." #economy# #markets# #centralbanks#

Central bank gold moves are about repatriation, not liquidation – @StoneX_Official O’Connell (Kitco News) – While the recent headline may give the impression that central banks are selling off some of their gold reserves, the gold has merely changed location in response to the rising perceived risk of sanctions and seizure, according to Rhona O'Connell, Head of Market Analysis for EMEA & Asia at StoneX. “News headlines last week captured the public's imagination with the reports of the Netherlands' central bank repatriating gold from North America into Europe,” wrote Rhona O'Connell on Wednesday.

CENTRAL BANKS FOCUS ON FUEL PRICES AS INFLATION RISK Central banks are increasingly watching refining margins, or “crack spreads,” as fuel shortages push gasoline and diesel prices higher. Bank of England Governor Andrew Bailey said refined fuel prices may provide a better inflation signal than crude oil alone. Wars in Iran and Ukraine have disrupted refining and exports, widening diesel margins sharply. The BOE estimates higher energy costs could add 0.4 percentage points to inflation in the second half of 2026.

Central banks bought a record 289 tonnes of gold in Q2 2026, five times the Q1 figure, according to the WGC. Behind that lies a broader accumulation trend: 🇵🇱 Poland: +90t this year, moving toward its published 700t target. 🇨🇳 China: +80t this year, extending its buying streak to 22 consecutive months. 🇰🇷 South Korea: returning to gold purchases for the first time since 2013. 🇸🇬 Singapore: resumed buying in May after an eight-month pause. Different economies but the same direction: gold is taking on a more prominent role in strategic reserves.