Central banks can’t hang on forever for the US to start cutting

 — but still fear going first.

Developed market central banks are facing an unwanted problem: It no longer seems certain that they can manage a descent to pre-pandemic levels of inflation or interest rates.

The stickiness of US inflation has implications elsewhere. Other central banks, such as the European Central Bank and the Bank of England, are left with no choice but to cut rates ahead of the Fed.

Barring any surprise surge in inflation and wages, these two central banks are on track to begin their descent in June. 

Dangerously — monetary policy can be like mountaineering. The descent is more hazardous than the climb to the top 

John Authers Bloomberg 1 maj 2024 at 06:04 CEST

https://www.bloomberg.com/opinion/articles/2024-05-01/rate-cuts-fed-won-t-climb-down-yet-but-others-can-t-wait-any-longer