The global wave of interest rate cuts has noticeably slowed down, as major central banks take a cautious pause amid rising uncertainties over economic growth, inflation, and global trade tensions.
In April 2025, only two out of the five major central banks overseeing the world’s top-traded currencies made cuts. The European Central Bank and the Reserve Bank of New Zealand trimmed their rates by a combined 50 basis points. Meanwhile, central banks in Australia, Japan, and Canada opted to keep their rates steady, while the U.S., Britain, Sweden, Norway, and Switzerland did not hold policy meetings last month.
By contrast, just two months ago, half of the top G10 central banks were actively cutting rates. The big question now centers on the U.S. Federal Reserve, which wraps up its policy meeting later today. According to Jean Boivin, head of the BlackRock Investment Institute, the Fed faces a “sharp policy tradeoff” as it juggles weakening economic activity alongside stubborn inflation, underscored by the latest first-quarter GDP numbers.
So far this year, across the G10 group, central banks have delivered a net tightening of 25 basis points — thanks to a single rate hike from Japan — while a total of 325 basis points have been cut across 12 easing moves.
A similar cautious tone is being felt in emerging markets. Out of 13 major developing-world central banks that met in April, only four — India, Thailand, the Philippines, and Colombia — reduced their key rates, each by 25 basis points. Eight kept rates unchanged, despite many facing low inflation and slowing growth. Analysts point to concerns over U.S. dollar volatility, Federal Reserve uncertainties, and fears that ongoing tariff battles could trigger capital outflows — influencing the decisions of central banks like South Korea and Indonesia to hold rates steady.
In a surprise move, Turkey went in the opposite direction, delivering a sharp 350 basis point rate hikes in April to curb capital flight following political turmoil. Combined with Brazil’s two hikes earlier this year, total tightening among emerging market central banks in 2025 now stands at 550 basis points.
On the easing side, emerging markets have delivered 850 basis points in rate cuts through 14 separate moves so far this year.
As the world waits for the next signals from the U.S. Federal Reserve, economists are closely watching how central banks globally balance the pressures of inflation, growth slowdowns, and the ripple effects of trade tensions.
We will bring you the latest updates right here on SNEWS TV as this story develops. Stay tuned.
Reporting by Katy Moore.
