Central Bank policy and macro stance in one view

Bias: BOJ raised policy rate 25bp to 1.00% on June 16 — highest since 1995 — continuing gradual normalisation. Officials see scope for further hikes given negative real rates and persistent inflation above 2%. Gradual path but clear tightening direction.

June 16 BoJ Policy Board: 7-1 vote to hike to 1.00%; sole dissenter Asada Toichiro cited Middle East downside risks. Governor Ueda absent; statement notes BoJ will 'continue to raise policy rate.' Underlying CPI approaching 2% target. Real rates still deeply negative at 1% nominal vs ~2% inflation. Market pricing further hike late 2026.

Bias: Rates held at 3.50-3.75%; dot plot revised sharply higher with median 3.8% end-2026 target; 9 of 18 members project at least one hike. Easing bias language stripped entirely under new Chair Warsh.

June 17 FOMC: 12-0 unanimous hold; new summary of economic projections raised PCE inflation forecast to 3.6% for 2026; unemployment forecast 4.3%. Warsh revamped statement to remove all forward-guidance dovish language. Iran conflict cited as upside inflation risk. Market pricing ~40bp of additional tightening through year-end.

Bias: Cash rate held at 4.35% on June 16, third consecutive hold after three hikes earlier in 2026. RBA tone explicitly hawkish: further hikes not ruled out. Iran conflict energy shock flagged as upside inflation risk. Big four banks split on whether further hikes occur.

June 16 RBA: hold at 4.35%. Statement warns Middle East conflict could add to inflation pressures. Assistant Governor Sarah Hunter speech (May 19) flagged surging energy costs spilling into broader consumer prices. RBA hiked three times earlier in 2026. 4.35% is the highest level since 2008. Two of four major banks project additional 25bp hike by year-end.

Bias: ECB delivered first rate hike since 2023 on June 11, raising deposit rate to 2.25%. Inflation forecast revised to 3.0% for 2026. Governing Council flags Middle East energy shock as primary driver; stands ready to tighten further.

June 11 Governing Council meeting: +25bp unanimous hike; deposit facility 2.25%, MRO 2.40%, MLF 2.65%. 2026 headline inflation projection 3.0% (vs 2.6% prior); GDP projection trimmed to 0.8%. ECB said hike is 'robust across scenarios' mapping Middle East shock. No forward guidance on further hikes but language hawkish.

Bias: Rates held at 3.75% but with strong hawkish undertone; April vote 8-1 for hold vs hike. June 18 MPC decision released today — widely expected hold but hawkish split. Markets pricing ~50bp of further tightening over 12 months.

April 30 MPC: 8-1 hold with Chief Economist Huw Pill voting for immediate hike to 4.00%. MPC language states policy 'would need to lean against' second-round inflation effects. UK CPI at 2.8% (April), elevated above 2% target. June 18 decision: widely expected hold with hawkish dissenter(s). BoE warned of CPI rising to 3-3.5% over next quarters.

Bias: Policy rate held at 0.00% at June 18 quarterly meeting. SNB faces near-zero inflation (0.1% Feb), tiny energy-driven uptick. Primary concern is excessive CHF appreciation not inflation. Interventionist FX stance but no rate change.

June 18 SNB quarterly assessment: rate held at 0.00% as expected. SNB signals greater willingness to intervene in FX markets to prevent CHF overappreciation amid Middle East safe-haven demand. Inflation forecast 0.5% for 2026/2027. GDP expected ~1% growth 2026. Negative rates not expected; first hike not projected before H2 2027.

Bias: OCR held at 2.25% at May 27 meeting. Easing cycle complete after 325bp of cuts from 5.50% peak. RBNZ signals it expects to raise rates this year to contain Iran-driven inflation. Neutral currently but hawkish lean forming.

May 27 RBNZ MPC: hold at 2.25%, fifth consecutive hold. RBNZ notes Middle East conflict will keep inflation above 1-3% target range this year. Statement says 'we expect to increase interest rates this year.' Q1 GDP recovering. CPI 3.1% end-2025, expected to remain elevated near-term. Next OCR review July 8.

Bias: Fifth consecutive hold at 2.25%. Governor Macklem explicitly described a 'two-directional bind': soft GDP (Q1 contracted) vs rising oil-driven inflation at 2.8%. No easing or tightening bias — genuinely data-dependent.

June 10 BoC: hold at 2.25% for fifth consecutive decision. Q1 GDP edged down 0.1%. Unemployment 6.5-7.0%. CPI 2.8% in April driven by oil. Bank expects inflation near 3% near-term, declining to 2% by early 2027. Macklem kept both cut and hike options open. Next decision July 15.