The Fed left its benchmark federal funds rate at a 23-year high for the eighth meeting in a row, holding it in a range of 5.25% to 5.5%. But the central bank seems increasingly confident that inflation is headed toward its 2% target, saying that it could start lowering interest rates as soon as its next meeting in September. Britain received its first interest rate cut since the pandemic last week, following a tight five-to-four vote from the BoE. The central bank reduced the UKās key interest rate by a quarter of a percentage point to 5%, after keeping it at a 16-year high for a year to bring down inflation. But that doesnāt guarantee more trims in the near future. In fact, the BoE didnāt indicate where rates might settle in the future or how quickly it would lower them. Instead, the central bank warned that cuts need to happen slowly and with caution. The eurozone economy expanded by 0.3% last quarter from the one before, matching its pace from the start of the year and surpassing forecasts of 0.2%. See, even though Germany ā the blocās biggest economy ā posted an unexpected 0.1% drop, that was offset by solid performances from Spain, France, and Italy. That might be enough to reassure cautious investors, after some started doubting whether the regionās recent recovery still had legs. Inflation data wasnāt quite as positive, though. A separate report out last week showed that annual inflation in the eurozone increased slightly to 2.6% in July from 2.5% the month before, defying economistsā expectations for a flat reading. Combine that unexpected jump with the hardy economic readings, which show the region is still resilient in the face of high borrowing costs, and the European Central Bank may see little reason to rush to cut rates again. But for now, traders are still widely expecting a quarter-point reduction to come out of the bankās next meeting in September. On the contrary, the BoJ raised its benchmark interest rate to āaround 0.25%ā ā the highest level since December 2008 ā from a previous range of 0% to 0.1%. Policymakers stopped short of committing to any further hikes this year, saying theyāll only consider them in response to evolving data and after assessing the impact of last weekās move. Finally, the central bank outlined plans to halve the amount of bonds it buys every month to around 3 trillion yen ($19.6 billion) by the first quarter of 2026. | 