After the Federal Reserve’s first interest rate drop of 2025 in September, two more cuts are on the table before the year ends. Central banks across the world are mostly following the same path. Out of 23 major monetary authorities reportedly tracked by Bloomberg, 15 are expected to ease borrowing costs. That includes the Fed, which plans to keep trimming rates slowly into next year. The exception? Europe. Policymakers from Frankfurt to London are slamming the brakes on further cuts … at least for now. Bloomberg says the global wave of monetary easing is back in motion, except in Western Europe. Central banks in the Nordics and the UK are now holding steady, waiting to see if inflation behaves. Even Switzerland, expected to cut one last time into negative territory, isn’t staying there long. The Bank of Japan is the lone major player heading in the other direction, preparing to raise rates in the coming weeks. Fed eyes more cuts while juggling Trump pressure and inflation fears The Fed isn’t rushing though. It’s planning two more cuts by December and steady quarterly reductions through the first nine months of 2026. But the pace is slow. Officials are watching how President Donald Trump’s tariffs will hit prices. Forecasts now show a higher end-point for rates in the US than what was predicted back in July. The central bank is tiptoeing, with one eye on inflation and the other on political pressure. On October 28-29, Fed policymakers meet again. Markets expect another quarter-point cut. Last month’s move was just the beginning. The Fed wants to ease pressure on the labor market without letting inflation spike again. Behind the scenes, the White House is turning up the heat. Trump is expected to name a new Fed chair soon, with Jerome Powell’s term ending in May. The courts are also involved. Trump tried to fire Governor Lisa Cook, but the Supreme Court said no. That decision buys Cook time, at least until the court hears arguments in January. For now, that pause helps the Fed breathe, but the pressure isn’t going anywhere. Meanwhile, BE’s global cost-of-borrowing gauges are climbing. At the end of 2026, both world and advanced-economy rates are projected to be about a quarter-point higher than before. That reflects economic resilience mixed with lingering inflation jitters. Trump’s market-shaking moves haven’t made forecasting easier. Still, Bloomberg’s new numbers cover 90% of the world economy. It’s the best guess policymakers have for what’s next. Europe holds rates as Japan signals hike and UK turns cautious Europe’s message is clear: No more rate cuts. ECB officials think inflation is stable and the eurozone can still grow even with higher US tariffs. They’re not moving unless inflation dives. Their last meeting in December will show new forecasts stretching out to 2028. If inflation drops below expectations again, even the hawks might bend and allow one more cut. But for now, they’re holding tight. Japan’s central bank is moving the other way. Kazuo Ueda, head of the Bank of Japan, is getting ready to raise rates. Two of his board members voted against holding steady last month. Even one of the most dovish voices turned hawkish. That jolted traders and opened the door for a hike as soon as October. Inflation’s been over the BOJ’s target for more than three years. US tariffs haven’t dented Japan’s economy much. And now, Sanae Takaichi, the newly elected leader of the ruling party, may influence the BOJ’s direction. She’s pro-easing, but Ueda looks ready to break the deadlock. In the UK, the Bank of England is stalling. Andrew Bailey, the governor, isn’t sure they’ll stick to the once-a-quarter cut plan. Recent meetings show big disagreements. Food prices are soaring, and households expect inflation to keep rising. The next BoE meeting falls between September inflation data, likely to show 4% price growth, and the UK government’s autumn budget on November 26. That timing complicates everything. This week is packed with economic events too. Tuesday brings NY Fed inflation expectations data. Wednesday, the Fed drops meeting minutes. Thursday, Powell speaks. And Friday could see the Jobs Report, if the US government ends its shutdown. Want your project in front of crypto’s top minds? Feature it in our next industry report, where data meets impact.
