Several central banking big-hitters meet in coming days, with the U.S. Federal Reserve's Sept. 21-22 meeting topping the must-watch list.
The timing of the Fed's U.S. tapering plans remains the key question and recent data suggests caution may be warranted: the U.S. economy created the fewest jobs in seven months in August and consumer prices increased at their slowest pace in six months.
Several officials say the Fed's tapering of its pandemic stimulus will start this year, a view Fed chief Jerome Powell may echo, while stressing an interest rate rise is still way off.
The Bank of Japan, which also meets on Tuesday and Wednesday, will keep policy steady but could well warn of growing risks to exports from supply disruptions.
- U.S. inflation coming off the boil as prices increase slowly in August
- BOJ to maintain stimulus as supply disruption darkens export outlook
Central bank policy rates https://graphics.reuters.com/USA-MARKETS/CENTRALBANKS/zjpqkjjowpx/chart.png
Confirmation that a major central bank is raising interest rates rather than just talking about it, will be significant for markets hooked on cheap cash. On Thursday, Norway's central bank is set to become the first from the developed world to hike rates since the pandemic, likely raising its main 0% rate to 0.25%.
The Bank of England is unlikely to change policy but with consumer price growth at a 9-year high in August, traders are pricing a rate rise next May. The BoE may signal at its Thursday meeting...
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