Property demand in Hong Kong is falling now and sliding demands shows how a city which was at a forefront of a global property earlier booming is now bracing for an even deeper slump interest rates.

World Business Watch: Hong Kong property market tumbling as unsold homes pile up

The Reserve Bank of India hiked interest rates by 50 basis points, signalling its intent to tame inflation and defend the rupee. What does this decision mean for you? Does the dip in foreign markets make it a lucrative investment opportunity? Priyanka Sharma tells you.

Gravitas | RBI hikes lending rate by 50 bps: What does it mean for you?

The Bank of England has said it "will not hesitate" to change interest rates in order to get inflation under control. The Bank released a statement on Monday after the pound plummeted to a record low of $1.03.

'Won't hesitate to raise interest rates after pound's fall', says Bank of England

The US Federal Reserve announced a third consecutive interest hike of 75 basis points. Central banks around the world are risking a recession to tame inflation. Which way should India go? Molly Gambhir tells you.

Gravitas: US Federal Reserve risking recession to tame inflation

US Federal Reserve has raised interest rates by three-quarters of a percentage point for the third consecutive time and forecast further aggressive increases to tame record-high inflation.

US Federal Reserve raises interest rates for third straight time, sees more increases ahead

The Asian Development Bank cut its economic growth forecast for developing Asia amid rising interest rates, a prolonged war in Ukraine and China's Covid Zero policy.

World Business Watch: Asian development bank cuts growth forecast for year 2022-23

The world's largest economy, the United States of America is struggling with a 40-year high inflation. US federal reserve is poised to unleash another interest rate hike after the latest data showed a worrying U.S inflation picture. An increase in the interest rate is expected on Wednesday.

US attempts to tackle 40-year-high inflation; hike in interest rate expected on Wednesday

European Central Bank policymakers see a rising risk that they will have to raise their key interest rate to 2% or more to curb record-high inflation in the euro zone despite a likely recession.

World Business Watch: ECB governors see rising risk of rate hitting 2% to curb inflation

Inflation woes continue to hit one of South America's largest economy Argentina. The Central Bank in the country has raised its benchmark interest rate by whopping 9.5 percent, the price rise in Argentina is one of the highest in the world.

Argentina hikes key interest rate to 69.5%, one of the highest in the world

India's RBI hiked key lending rates by 50 basis points to tame the rising inflation. Will it be enough to control the spiraling cost-of-living crisis? How does India's economic situation compare with the world? Palki Sharma tells you.

Gravitas: India's RBI hikes key interest rates

The European Central Bank brought an end to the era of negative interest rates in the eurozone with a bigger than expected half-point hike to combat soaring inflation. Molly Gambhir tells you what it means for the Eurozone.

WION Fineprint | Eurozone raises interest rates for first time in 11 years

The European Central Bank has raised interest rates for the first time in 11 years by a larger-than-expected amount in an attempt to cool rampant inflation in the euro zone.

European Central Bank hikes interest rates for first time in 11 years by larger-than-expected amount

The Bank of England (BoE) has hinted at further interest rate rises as it vows to bring inflation back down to 2%. BoE's chief economist Huw Pill said that the central bank's focus was getting prices down and making life more affordable again.

Bank of England warns of rate hike, vows to bring down inflation

The US Federal Reserve raised its benchmark interest rate by 75 basis point. This is the biggest and most aggressive interest rate increase since 1994. The Federal Open Market Committee said that it decided to raise the target range for the benchmark borrowing rate to 1.5%-1.75%.

Federal reserve raises rates by 75 basis-point, most aggressive rate hike since 1994

All eyes are on US central bank Fed's decision on interest rates. There are predictions that the Fed could increase rates by 0.75% in the United states. This will be the biggest interest rate hike.

Wall Street slips into a bear market, all eyes on US fed interest rate hike

Ukraine jacked up its main interest rate to a seven-year-high of 25% from 10% on Thursday, tightening policy for the first time since the Russian invasion to tackle double-digit inflation and protect the hryvnia as some business activity returns.

The Feb. 24 invasion has devastated the economy, which could shrink by at least a third this year as the war has forced 40% of businesses to close, destroyed infrastructure, blocked shipping routes and reduced whole towns to rubble.

Speaking at a briefing, Central Bank Governor Kyrylo Shevchenko called for talks with the International Monetary Fund on a new aid programme.

The rate increase was criticised by an adviser to Ukrainian President Volodymyr Zelenskiy's office, who said the rate was too high and dangerous to the economy during wartime. It was not clear whether he was speaking in a personal capacity.

The prime minister's office and the finance ministry declined immediate comment.

The National Bank of Ukraine (NBU) had frozen its main rate 10% at the start of the invasion, but last week it signalled it could resume regular monetary policy reviews as business activity partially recovered in safer parts of the country.

It is betting that a sharp rate hike will also nudge the government to raise the yield on domestic bonds, making hryvnia assets more attractive and preventing household incomes and savings from being eroded by inflation.

The central bank has fixed the hryvnia exchange rate, which has forced it to sell billions of dollars in forex reserves since the start of the invasion. It aims to let the currency float freely eventually once conditions allow.

"The NBU expects that a significant rise in the key policy rate, to 25%, will be sufficient to ease pressures on the FX market and stabilize inflation expectations, which in the future will lay the foundations for a monetary policy easing cycle," it said.

"If yields on hryvnia assets do not rise sufficiently, international reserves will keep depleting rapidly and imbalances will build up in the economy," it said.

Inflation was already in double digits before the conflict began and climbed further to around 17% in May from 16.4% in April, according to NBU estimates.

The central bank said inflation could double in 2022 from 10% in 2021, pushed up by rising global prices and the damage of the war on domestic production and supply chains.

"A decisive rise in the key policy rate will spur investors’ interest in hryvnia assets, while also easing pressures on international reserves and reining in inflation," the NBU said.

The number of small businesses that had suspended operations in April fell to 26% from 73% in March, according to a survey by the European Business Association, the union of businesses operating in Ukraine.

Thursday's move takes the main interest rate to its highest level since 2015, when Ukraine's economy was reeling from Russia's annexation of Crimea and the outbreak of war between Ukrainian troops and Russian-backed forces in eastern Ukraine.

"The NBU raised the rate to 25%. That's too much. Abrupt movements during the war, when the economy is in a fragile state - are dangerous," presidential adviser Tymofiy Mylovanov wrote on Facebook.

You can now write for wionews.com and be a part of the community. Share your stories and opinions with us <a href="https://www.wionews.com/content-contribution-registration-form">here</a>.

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Ukraine jacked up its main interest rate to a seven-year-high of 25% from 10% on Thursday, tightening policy for the first time since the Russian invasion to tackle double-digit inflation and protect the hryvnia as some business activity returns.

Ukraine jacked up its main interest rate to a seven-year-high of 25% from 10% on Thursday, tightening policy for the first time since the Russian invasion to tackle double-digit inflation and protect the hryvnia as some business activity returns. The Feb. 24 invasion has devastated the economy, which could shrink by at least a third this year as the war has forced 40% of businesses to close, destroyed infrastructure, blocked shipping routes and reduced whole towns to rubble. Speaking at a briefing, Central Bank Governor Kyrylo Shevchenko called for talks with the International Monetary Fund on a new aid programme. The rate increase was criticised by an adviser to Ukrainian President Volodymyr Zelenskiy's office, who said the rate was too high and dangerous to the economy during wartime. It was not clear whether he was speaking in a personal capacity. The prime minister's office and the finance ministry declined immediate comment. The National Bank of Ukraine (NBU) had frozen its main rate 10% at the start of the invasion, but last week it signalled it could resume regular monetary policy reviews as business activity partially recovered in safer parts of the country. It is betting that a sharp rate hike will also nudge the government to raise the yield on domestic bonds, making hryvnia assets more attractive and preventing household incomes and savings from being eroded by inflation. The central bank has fixed the hryvnia exchange rate, which has forced it to sell billions of dollars in forex reserves since the start of the invasion. It aims to let the currency float freely eventually once conditions allow. "The NBU expects that a significant rise in the key policy rate, to 25%, will be sufficient to ease pressures on the FX market and stabilize inflation expectations, which in the future will lay the foundations for a monetary policy easing cycle," it said. "If yields on hryvnia assets do not rise sufficiently, international reserves will keep depleting rapidly and imbalances will build up in the economy," it said. Inflation was already in double digits before the conflict began and climbed further to around 17% in May from 16.4% in April, according to NBU estimates. The central bank said inflation could double in 2022 from 10% in 2021, pushed up by rising global prices and the damage of the war on domestic production and supply chains. "A decisive rise in the key policy rate will spur investors’ interest in hryvnia assets, while also easing pressures on international reserves and reining in inflation," the NBU said. The number of small businesses that had suspended operations in April fell to 26% from 73% in March, according to a survey by the European Business Association, the union of businesses operating in Ukraine. Thursday's move takes the main interest rate to its highest level since 2015, when Ukraine's economy was reeling from Russia's annexation of Crimea and the outbreak of war between Ukrainian troops and Russian-backed forces in eastern Ukraine. "The NBU raised the rate to 25%. That's too much. Abrupt movements during the war, when the economy is in a fragile state - are dangerous," presidential adviser Tymofiy Mylovanov wrote on Facebook. You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here. WATCH WION LIVE HERE ×

Ukraine jacks up key rate to 25% in first hike since Russian invasion

The Russian Central Bank cut interest rates from 14% to 11%, after inflation slowed to 17.5% in May compared to 17.8% in April, which is now forecasting that annual inflation will decrease to 5–7% in 2023 and return to 4% in 2024.

Russian Central Bank cuts interest rates from 14% to 11%

The Bank of England’s policymakers are expected to increase interest rates from 0.75% to 1%, a level not seen since 2009. The Bank expects UK inflation to rise to roughly 10% this year as a result of the Russia-Ukraine war and lockdowns in China.

Bank Of England hikes interest rates to 13-year high

The Reserve Bank of India (RBI) raised the repo rate - at which it lends money to commercial banks - by 40 basis points to 4.4%.

India's central bank RBI hikes interest rate

US Federal reserve has hiked interest rates by 50 basis points, in a bid to reign in the raging inflation in the country, the hike is the biggest rate hike since 2000 and the Fed chair has promised to use all available tools to check the four decade high inflation rate.

Fed raises interest rates by 50-bps, markets welcome interest rate

Australia's central bank on Tuesday raised its cash rate by a surprisingly large 25 basis points to 0.35%, the first hike in over a decade, and flagged more to come as it pulls down the curtain on massive pandemic stimulus.

Australia's central bank hikes interest rates

To control inflation and also to prop up the economy, the US central bank is preparing for a rate hike that can come as soon as next month.

US interest rate hike likely in March: Powell testified before US Congress

Federal Reserve officials are coalescing around a plan to raise interest rates steadily starting in March and then move swiftly to shrink the central bank’s big bond holdings as policymakers look to cool the economy at a moment of rapid inflation.

Policymakers have spent the past week broadcasting that the interest rate increase they plan to make at their March meeting — one that investors already fully expect central bankers to make as they try to tame price increases — will be the first in a string of rate moves. Central bankers also appear to be converging on a plan to promptly start shrinking the Fed’s holdings of government-backed debt, which were vastly expanded during the pandemic downturn as the Fed snapped up bonds in a bid to keep markets functioning and cushion the economy.

The central bank bought $120 billion in Treasury and mortgage-backed securities for much of 2020 and 2021, but officials have been tapering those purchases and are on track to stop them entirely in March. By quickly pivoting to allow securities on its now nearly $9 trillion balance sheet to expire without reinvestment — reducing its holdings over time — the central bank would take away an important source of demand for government-backed debt and push rates on those securities higher. That would work together with a higher Fed policy interest rate to make many types of borrowing more expensive.

Higher borrowing costs should weigh on lending and spending, tempering demand and helping to slow price gains, which have been uncomfortably rapid. Fresh data out this week is expected to show further acceleration in the central bank’s preferred inflation gauge, which is already running at its fastest pace in 40 years.

Lael Brainard, a Fed governor who has been nominated by President Joe Biden to serve as vice chair, said last week that she believed a “series” of rate increases were warranted.

“I do anticipate that it will be appropriate, at our next meeting, which is in just a few weeks, to initiate a series of rate increases,” she said Friday at a forum held by the University of Chicago’s Booth School of Business in New York. Brainard said that the Fed would then turn to shrinking its balance sheet, a process that could be appropriate to start “in coming meetings.”

Michelle Bowman, another Fed governor, echoed that balance sheet reduction could start imminently, saying in a speech Monday that the Fed needs to begin to reduce the size of its bond holdings “in the coming months.”

The precise timing of balance sheet shrinking is a topic of debate. John Williams, president of the Federal Reserve Bank of New York, suggested Friday that the process could start “later this year,” which could suggest in coming months or slightly later. But officials have been uniformly clear that a pullback is coming — and likely more quickly than investors had expected until just recently.

Although Fed policymakers plan to shrink their holdings of Treasury bonds and mortgage-backed securities by allowing securities to expire without reinvesting them, rather than by actively selling the debt, the central bank’s latest meeting minutes suggested that officials could eventually move to outright sales of mortgage-tied securities. The minutes also suggested that officials thought “a significant reduction” in the size of the balance sheet would be warranted.

The central bank’s planned moves would be a rapid pace of change compared to the last time they increased interest rates, from 2015 to the end of 2018. Then, officials shrank the balance sheet only gradually and pushed up interest rates glacially, once per quarter at fastest.

Borrowing costs have already begun to rise as investors adjust to the Fed’s more rapid-fire plans. Markets expect six or seven quarter-point interest rate increases this year. The rate on a 30-year mortgage has climbed from about 2.9% last fall — when the Fed began its policy pivot — to 3.9% now.

The Fed’s policy changes “will bring inflation down over time, while sustaining a recovery that includes everyone,” Brainard said, adding that as the Fed signals that it will raise rates, “the market is clearly aligned with that.”

Yet with inflation rapid, wage growth strong and signs of taut labour market conditions plentiful, some Fed officials worry that the central bank needs to move even more quickly.

Bowman, for instance, said she was still open to a half-percentage point increase in March — something her colleague James Bullard, president of the Federal Reserve Bank of St. Louis, has also suggested.

“I will be watching the data closely to judge the appropriate size of an increase at the March meeting,” Bowman said.

But Bullard, who has repeatedly said he would prefer to see rates rise by a full percentage point of rate increases by July, has also noted that he would defer to the chair, Jerome Powell, on the size of the initial increase. And other members of the Fed’s policy-setting committee have suggested that they do not think starting with a half-point increase is necessary, suggesting that a smaller increase may be more likely.

“There’s really no kind of compelling argument that you have to be faster right in the beginning,” Williams, president of the powerful Federal Reserve Bank of New York, told reporters last week.

Federal Reserve officials are coalescing around a plan to raise interest rates steadily starting in March and then move swiftly to shrink the central bank’s big bond holdings as policymakers look to cool the economy at a moment of rapid inflation.

Federal Reserve officials are coalescing around a plan to raise interest rates steadily starting in March and then move swiftly to shrink the central bank’s big bond holdings as policymakers look to cool the economy at a moment of rapid inflation. Policymakers have spent the past week broadcasting that the interest rate increase they plan to make at their March meeting — one that investors already fully expect central bankers to make as they try to tame price increases — will be the first in a string of rate moves. Central bankers also appear to be converging on a plan to promptly start shrinking the Fed’s holdings of government-backed debt, which were vastly expanded during the pandemic downturn as the Fed snapped up bonds in a bid to keep markets functioning and cushion the economy. The central bank bought $120 billion in Treasury and mortgage-backed securities for much of 2020 and 2021, but officials have been tapering those purchases and are on track to stop them entirely in March. By quickly pivoting to allow securities on its now nearly $9 trillion balance sheet to expire without reinvestment — reducing its holdings over time — the central bank would take away an important source of demand for government-backed debt and push rates on those securities higher. That would work together with a higher Fed policy interest rate to make many types of borrowing more expensive. Higher borrowing costs should weigh on lending and spending, tempering demand and helping to slow price gains, which have been uncomfortably rapid. Fresh data out this week is expected to show further acceleration in the central bank’s preferred inflation gauge, which is already running at its fastest pace in 40 years. Lael Brainard, a Fed governor who has been nominated by President Joe Biden to serve as vice chair, said last week that she believed a “series” of rate increases were warranted. “I do anticipate that it will be appropriate, at our next meeting, which is in just a few weeks, to initiate a series of rate increases,” she said Friday at a forum held by the University of Chicago’s Booth School of Business in New York. Brainard said that the Fed would then turn to shrinking its balance sheet, a process that could be appropriate to start “in coming meetings.” Michelle Bowman, another Fed governor, echoed that balance sheet reduction could start imminently, saying in a speech Monday that the Fed needs to begin to reduce the size of its bond holdings “in the coming months.” The precise timing of balance sheet shrinking is a topic of debate. John Williams, president of the Federal Reserve Bank of New York, suggested Friday that the process could start “later this year,” which could suggest in coming months or slightly later. But officials have been uniformly clear that a pullback is coming — and likely more quickly than investors had expected until just recently. Although Fed policymakers plan to shrink their holdings of Treasury bonds and mortgage-backed securities by allowing securities to expire without reinvesting them, rather than by actively selling the debt, the central bank’s latest meeting minutes suggested that officials could eventually move to outright sales of mortgage-tied securities. The minutes also suggested that officials thought “a significant reduction” in the size of the balance sheet would be warranted. The central bank’s planned moves would be a rapid pace of change compared to the last time they increased interest rates, from 2015 to the end of 2018. Then, officials shrank the balance sheet only gradually and pushed up interest rates glacially, once per quarter at fastest. Borrowing costs have already begun to rise as investors adjust to the Fed’s more rapid-fire plans. Markets expect six or seven quarter-point interest rate increases this year. The rate on a 30-year mortgage has climbed from about 2.9% last fall — when the Fed began its policy pivot — to 3.9% now. The Fed’s policy changes “will bring inflation down over time, while sustaining a recovery that includes everyone,” Brainard said, adding that as the Fed signals that it will raise rates, “the market is clearly aligned with that.” Yet with inflation rapid, wage growth strong and signs of taut labour market conditions plentiful, some Fed officials worry that the central bank needs to move even more quickly. Bowman, for instance, said she was still open to a half-percentage point increase in March — something her colleague James Bullard, president of the Federal Reserve Bank of St. Louis, has also suggested. “I will be watching the data closely to judge the appropriate size of an increase at the March meeting,” Bowman said. But Bullard, who has repeatedly said he would prefer to see rates rise by a full percentage point of rate increases by July, has also noted that he would defer to the chair, Jerome Powell, on the size of the initial increase. And other members of the Fed’s policy-setting committee have suggested that they do not think starting with a half-point increase is necessary, suggesting that a smaller increase may be more likely. “There’s really no kind of compelling argument that you have to be faster right in the beginning,” Williams, president of the powerful Federal Reserve Bank of New York, told reporters last week.

US Fed officials firm up plans for a swift pullback of economic help

US Federal Reserve has held its key interest rates near zero and said it plans to continue supporting economic recovery. Fed is maintaining the policies until the economy heals further from the effects of COVID-19 pandemic.

World Business Watch: Powell waves inflation worries away as Fed holds rates near zero

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