Central banks signal slower pace of policy easing as inflation proves uneven

Several major central banks signalled this week that the pace of monetary easing will slow, pointing to persistent services inflation and labour markets that have proved more resilient than forecast.

Divergence between economies

Policymakers emphasised that headline disinflation has been driven substantially by energy and goods prices, while domestically generated inflation has receded more slowly.

Analysts said the shift in language matters more than the immediate decisions, because it reframes expectations for the coming year.

Market reaction

Government bond yields rose modestly following the statements, while equity markets were mixed.