Global Central Banks Diverge From Fed as Economic Challenges Mount

Central banks worldwide cut interest rates to support struggling economies, while the Federal Reserve holds firm amid U.S. economic strength.

The Federal Reserve has paused rate cuts as the U.S. economy remains robust, contrasting with rate reductions by central banks in Europe, Canada, India, and Mexico.
Global economic uncertainty, including trade tensions and inflation concerns, is prompting central banks to act independently of the Fed's policies.
The Bank of England cut rates despite stagflation fears, forecasting low growth and rising inflation, with GDP growth expectations halved to 0.75% for 2025.
Weaker currencies in regions like the eurozone and Switzerland may offset the impact of U.S. tariffs, benefiting exporters to the U.S. market.
The U.K. faces stagnating productivity and a challenging economic outlook, exacerbated by recent tax increases and public sector expansion.