: As resumed hostilities in the Middle East war drive oil towards US$100 a barrel, central bankers are not thrilled about the economic direction
From Washington to London to Tokyo, central bankers are set to reveal just how worried they are about a return of oil to about US$100 a barrel.Three days of G7 rate decisions, starting with the US Federal Reserve on Wednesday, followed by peers at the Bank of England on Thursday and the Bank of Japan on Friday, might show varying degrees of vigilance at the prospect of more energy-driven inflation, even if none is predicted to act on that for now.Together with the European Central Bank’s signal of its readiness to hike interest rates again, investor bets point to possible moves as soon as September within much of that club, even if economists are less sure.
A pump jack and drilling rig are visible near Midland, Texas, in 2025.
Most investors expect the Fed to hold rates steady at 3.50 to 3.75 percent for the fifth straight meeting, CME’s FedWatch monitoring tool showed.US consumer inflation eased to 3.5 percent year-on-year last month, but remains far higher than the Fed’s long-term two-percent target, which it has not achieved for more than five years.
