current
Global Policy Easing Cycle
Global central banks are cutting policy rates to support economic growth, impacting various sectors from housing to dealmaking.
Timeframe
near-term
Subcategories
Impact areas
Detailed Analysis
A significant shift in global monetary policy is underway, with a majority of central banks, including all G10 banks except Japan, lowering interest rates. This easing cycle is expected to continue, with market pricing suggesting further reductions in the U.S. and Europe. "27 of the 37 central banks that we track are now lowering interest rates," indicating a broad-based move towards stimulating economic activity. While this easing is expected to support growth and risk assets, its impact on borrowing and inflation is anticipated to be muted, unlike previous cycles.
Context Signals
OECD economies are returning to trend-like growth.
Inflation has cooled down to target levels.
Commercial real estate could be at a turning point, with potential opportunities in residential, industrial, and specialized workspaces.
Edge
The muted impact of rate cuts on borrowing could limit inflationary pressures, creating a more stable environment for long-term investments.
European markets, with a weaker growth outlook, may offer significant value in fixed income if growth weakens further.
The easing cycle may create selective opportunities in emerging markets, particularly those with strong fundamentals and less dependence on external factors.
