China Q2 2026 GDP Misses Forecast as Weak Domestic Demand Offsets Export Strength 
Dollar Eases as Middle East Conflict, Fed Outlook and Japan Pension Policy Drive FX Markets 
Goldman Sees Foreign Investors Driving India Stock Market Recovery 
Asian Stocks Rally as Cooling U.S. Inflation Boosts Fed Rate Cut Hopes 
South Korea’s KOSPI Enters Bear Market Despite Remaining 2026’s Best-Performing Major Stock Index 
Singapore GDP Grows 5.7% in Q2 2026 as AI-Driven Manufacturing Boosts Economy 
South Korea Central Bank Set to Raise Interest Rates as Inflation Stays Elevated 
China Home Prices Fall Again in June Despite Slower Pace of Decline 
Taiwan Central Bank Likely to Keep Interest Rates Unchanged Through 2027 
RBNZ Raises Interest Rates to 2.50%, Signals More Tightening as Inflation Risks Persist 
Central Banks Eye Gold, Reduce Dollar Exposure as AI Adoption Accelerates: OMFIF Survey 
Fed Reaffirms 2% Inflation Goal, Vows Forceful Action to Anchor Price Expectations 
Dollar Slides as Softer US Inflation Dims Fed Rate Hike Expectations 
RBA Minutes Signal Australia Central Bank Remains Ready to Raise Interest Rates if Inflation Persists 
BOJ Raises Interest Rates to 31-Year High, Signals Strong Focus on Inflation Risks 
Japan Signals Surprise Yen Intervention Strategy as BOJ Hawkish Stance Puts FX Traders on Alert 
European Stocks Slip as Middle East Tensions and Hormuz Threat Rattle Markets 
The Bank of England (BoE) is widely expected to keep interest rates unchanged this week as policymakers assess the growing economic risks tied to the ongoing Iran war and rising inflation pressures. After maintaining borrowing costs at 3.75% in March, the central bank is likely to adopt a cautious stance again, balancing concerns over economic slowdown with persistent inflation threats.
Financial markets, however, are signaling a different outlook. Investors are increasingly betting on potential rate hikes later this year, with expectations of incremental increases starting as early as July, followed by possible moves in September. Despite these projections, BoE Governor Andrew Bailey has indicated that raising rates too soon could be premature given the uncertain economic environment.
Economists remain divided. A Reuters poll suggests most analysts expect the Monetary Policy Committee (MPC) to vote overwhelmingly—possibly 8-1—to hold rates steady. Still, some policymakers may push for a proactive increase to 4.0% to curb inflation risks, especially as memories of the UK’s inflation surge above 11% in 2022 remain fresh.
The UK economy is particularly sensitive to rising energy prices due to its heavy reliance on natural gas. Recent data highlights a sharp increase in business input costs and record-high expectations for future price hikes, raising concerns about sustained inflation. The International Monetary Fund forecasts UK inflation could peak at 4% this year, reinforcing the pressure on policymakers.
BoE Chief Economist Huw Pill recently emphasized the risks of waiting too long to act, noting that delayed responses could worsen inflation outcomes. Meanwhile, other MPC members are weighing weakening consumer confidence, slower hiring, and broader economic uncertainty.
With limited clarity on how long the Iran war will disrupt global energy markets, the BoE is expected to reiterate its readiness to respond if conditions worsen. Updated economic forecasts due this week will likely show higher inflation and weaker growth through 2026 and 2027. For now, the central bank appears focused on gathering more data before making any decisive policy shifts.
