Most central banks have suspended their monetary policy rate cuts, a shift driven by renewed geopolitical instability and its direct impact on energy markets.
The pause reflects a broader recalibration of monetary strategy as policymakers confront the reality that the global disinflation trend has stalled.
The immediate catalyst is the renewed escalation of conflict leading to another closure of the Strait of Hormuz.
This chokepoint disruption has triggered fresh instability in energy markets, undermining the price stability that had allowed for recent easing cycles.
With energy prices volatile, the risk of imported inflation has returned to the forefront of central bank mandates.
This development aligns with recent warnings from the International Monetary Fund, which cited persistent shocks from ongoing wars as the primary driver behind the stalled disinflation trend.