Big central banks say rate hikes are getting closer

Major central banks held rates unchanged this week but signaled they could hike soon if the U.S.-Israeli war with Iran pushes energy prices higher and broadens inflation. The message is hawkish and reinforces policy uncertainty around the near-term rate path. Markets may price in higher-for-longer rates and greater volatility across rates, energy, and risk assets.

Analysis

Major central banks held rates unchanged this week but signaled they could hike soon if the U.S.-Israeli war with Iran pushes energy prices higher and broadens inflation. The message is hawkish and reinforces policy uncertainty around the near-term rate path. Markets may price in higher-for-longer rates and greater volatility across rates, energy, and risk assets.