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Fed’s Miran Still Backs Rate Cuts Despite Surging Oil Prices
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- Federal Reserve Gov. Stephen Miran reaffirmed his preference for four interest rate cuts this year despite rising oil prices.
- Gov. Miran dissented against the Fed’s March decision to hold rates steady, favoring a quarter-point cut.
- He stated policy should not be based on ‘short-term headlines’ and the energy shock could be looked through.
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Bank of Canada to Lose Two Members of Rate-Setting Governing Council
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- The Bank of Canada announced two deputy governors of its rate-setting governing council are departing, with internal replacements planned.
- Deputy Governor Rhys Mendes will leave on April 10, and Deputy Governor Sharon Kozicki intends to retire on July 15.
- The seven-member governing council, led by Gov. Tiff Macklem, sets interest-rate policy and ensures financial-system stability.
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Japan Consumer Inflation Rises at Slower Pace
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- Japan’s core consumer inflation rose 1.6% in February, falling below the Bank of Japan’s 2% target for the first time since March 2022.
- The slower inflation rate may provide the central bank more time to consider further rate increases amid geopolitical risks.
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Bank of Canada Speech Takes on Heightened Importance Amid Rapid Turn in Rate Expectations
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- Bank of Canada Senior Deputy Governor Carolyn Rogers will speak, potentially clarifying interest-rate expectations for 2026, as traders price in three hikes.
- The central bank left its policy rate unchanged March 18, citing prematurity to assess the war’s economic effect and contained energy cost risk.
- Economists argue market expectations for rate hikes are “out of step with reality,” citing stable pre-war inflation and a weak labor market.
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RBNZ Signals Rate Hikes Possible If Inflation Threats Linger
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- The Reserve Bank of New Zealand indicated it could raise interest rates if the Iran war’s oil price surge leads to sustained inflation.
- Governor Anna Breman said the central bank could “look through” a short-term rise in inflation.
- Breman said monetary policy should prevent a temporary inflation spike from turning into enduring inflationary pressures.
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Eurozone, Asian Business Activity Slows as Iran War Ramps Up Uncertainty
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- Business activity in the eurozone and parts of Asia slowed in March due to the war in Iran, driving energy prices and uncertainty.
- The eurozone’s composite PMI fell to 50.5 in March, its lowest level since May last year, below economists’ expectations.
- Activity also slowed sharply in India, Australia, and Japan, with India’s PMI falling to its lowest level since October 2022.
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EU and Australia Sign Free-Trade Agreement, Security Deal
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- The European Union and Australia agreed to a free-trade deal and security partnership amid growing geopolitical uncertainty.
- The free-trade agreement removes over 99% of tariffs on EU goods exports to Australia and secures critical raw materials for the EU.
- Australia and the EU will strengthen security cooperation, but the EU Parliament and Australia still need to ratify the deal.
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Eurozone Consumer Confidence Plunges at Sharpest Rate in Four Years
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- Eurozone consumer sentiment plunged to minus 16.3 in March, its lowest level since October 2023, due to the Middle East conflict.
- Rising energy prices, fueled by the Middle East conflict, are expected to push average eurozone inflation to 2.7% this year.
- German investor confidence also plunged in March, following downgrades to global growth expectations for 2026.
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WSJ Pro Central Banking brings you news and analysis from a global team of reporters and editors at The Wall Street Journal and Dow Jones Newswires. Send your tips, suggestions and feedback to service@dowjones.com. An artificial-intelligence tool created these summaries, which are based on the text of the article and checked by an editor. Read more about how we use artificial intelligence in our journalism.
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