Advanced economies are witnessing a significant shift in monetary policy trends during 2026. Following a five-year period where central banks acted largely in unison—raising and lowering rates together—their paths are now beginning to diverge. Current market expectations suggest the Federal Reserve is preparing to reduce rates, whereas the ECB appears satisfied with maintaining its current standing. In contrast, the outlook for Australia suggests a different direction. With trimmed-mean inflation rising to 3.3%, a figure exceeding initial forecasts, a rate increase seems to be just around the corner.

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