Federal Reserve Chair Jerome Powell stressed the uncertainty of the outlook as he kept US rates unchanged on Wednesday, two weeks before Trump is expected to unleash a wave of so-called reciprocal tariffs. The Bank of England then dropped its rate-cutting bias on Thursday and Sweden’s Riksbank declared its easing cycle was over — citing the complexity of the international backdrop.
US President Donald Trump has already upended global trade and the postwar international security consensus. Now he’s throwing central banking into disarray.
Monetary policymakers are being knocked off course by the twists and turns of White House policy, with markets paring back interest-rate cut expectations across the globe. No longer are central bankers “either the frontmen or rhythm-keepers of macro policy,” said Thierry Wizman, a strategist at Macquarie. “They’re now followers, who are ceding their dynamism to events in federal legislatures, executive mansions and diplomatic halls.”
