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2026-05-27 21:30:02
[US-Iran Stalemate Fuels Inflation Expectations, Global Central Banks Forced to Follow Suit, Fed's Tightening Shift Becomes Key Variable] ⑴ Bob Savage, a strategist at BNY Mellon, points out that against the backdrop of a lack of concrete solutions to the US-Iran conflict, global inflation expectations continue to rise, which may prompt the Federal Reserve and other central banks to consider raising interest rates. ⑵ He states that regardless of actual implementation, the mere expectation of the Fed returning to tightening constitutes a qualitative change in global policy expectations, and most central banks worldwide may need to at least verbally follow the Federal Open Market Committee. ⑶ Otherwise, central banks will face the risk of widening interest rate differentials with the dollar, which will have additional transmission effects in an environment where dollar-denominated commodities have already triggered inflationary pressures.
