For Europe and the US, inflation is not expected to change monetary policy yet. The ECB will probably cut rates by 25 basis points in September – Depositphotos.com, adamico
In Canada, inflation rose 2.9% in May, versus expectations of 2.6%. The Bank of Canada may hesitate before cutting rates. In Australia, the central bank could even raise rates in August.
Why should we be interested in Canada and Australia? They are good indicators for the global economy.
The message is clear : inflation is still presentFor example, the price of ocean freight increased to $4,510 from $1,200 by the end of 2023.
For Europe and the United States, inflation is not yet likely to change monetary policy. The European Central Bank (ECB) will probably lower its rates by 25 basis points in September.
In the UK, a rate cut is possible in August. In the US, the Federal Reserve (Fed) could cut rates this year, perhaps in September, but the political situation complicates things.
In Japan, authorities are concerned about the fall of the yen against the dollar and the euro. Despite the warnings, the yen remains weak, which helps Japanese exports. A stabilization of the yen at a low level seems likely, with the EUR/JPY rate between 167 and 170.
Finally, some good news for The Chinese Yuan: Its Continued Internationalization. CNH payments have increased by 30% from the peak in 2015, according to Chinese customs.
Read also: Foreign exchange: the dollar remains strong, especially against the euro
