Banking
Global central banks extend rate hike push in November
Published by Jessica Weisman-Pitts
Posted on December 2, 2022
3 min readLast updated: February 3, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on December 2, 2022
3 min readLast updated: February 3, 2026
By Karin Strohecker and Vincent Flasseur
LONDON (Reuters) – The pace and scale of rate hikes delivered by central banks in November picked up speed again as policy makers around the globe battle decade high inflation.
Central banks overseeing six of the 10 most heavily traded currencies delivered 350 basis points (bps) of rate hikes between them last month.
The U.S. Federal Reserve, the Bank of England, the Reserve Bank of Australia, Norway’s Norges Bank, Sweden’s Riksbank and the Reserve Bank of New Zealand all raised interest rates in November.
The European Central Bank, the Bank of Canada, the Swiss National Bank and the Bank of Japan did not hold rate setting meetings in November.
The latest moves have brought total rate hikes in 2022 from G10 central banks to 2,400 bps.
“Interest rates will continue to rise,” said Alexandra Dimitrijvic at S&P Global Ratings, looking ahead to 2023. “Central banks’ determination to bring down inflation suggests that policy rates need to go higher still.”
Graphic: Developed markets interest rates https://www.reuters.com/graphics/GLOBAL-MARKETS/klpygkyzepg/G10CEN1.2.gif
Global financial markets have been on a roller coaster in recent weeks as investors try to gauge how fast and how far the U.S. Federal Reserve and other major central banks are set to raise rates to combat inflationary pressures, while fears over a slowdown in global growth are spreading.
Some nascent signs that inflation could be slowing in the United States have brought cheer to markets in recent days, with Fed officials scheduled to meet on Dec. 13 and 14.
On Wednesday, Fed Chair Jerome Powell said the U.S. central bank could scale back the pace of its rate increases “as soon as December”.
Data from emerging market central banks showed a similar pattern. Eight out of 18 central banks delivered a total 400 bps of rate hikes in November – up from 325 bps in October, but some way off the 800-plus bps monthly tallies in both June and July.
Graphic: Emerging markets interest rates https://www.reuters.com/graphics/GLOBAL-MARKET/lbvggnegavq/EMCEN1.1.gif
Indonesia, South Korea, Mexico, Thailand, Malaysia, the Philippines, Israel and South Africa all hiked rates in November, showing the wave of policy tightening shift towards Asia and away from Latin America and emerging Europe, where the cycle is nearing its end.
“With the exception of a few countries, we are past the most intensive phase of the rate hike cycle,” said Nafez Zouk at Aviva Investors.
Outlier Turkey, where President Tayyip Erdogan is pushing for lower interest rates, delivered another 150 bps benchmark cut to bring rates down to single digits, despite inflation running at above 80%.
Not all emerging market central banks in the sample had rate setting meetings last month.
Emerging market central banks have raised interest rates by a total of 7,165 bps year-to-date, more than double the 2,745 bps for the whole of 2021, calculations show.
(Reporting by Karin Strohecker and Vincent Flasseur in London Editing by Mark Potter)
A central bank is a national institution that manages a country's currency, money supply, and interest rates. It oversees monetary policy and aims to maintain economic stability.
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is typically measured as an annual percentage increase.
Rate hikes refer to increases in interest rates set by central banks. These hikes are used to control inflation and stabilize the economy by influencing borrowing and spending.
Monetary policy is the process by which a central bank manages the money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.
Emerging markets are countries with developing economies that are in the process of industrialization and growth. They often present investment opportunities due to their potential for rapid economic expansion.
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