Tausi Insider

The Federal Reserve’s signalling of a slowdown in the pace of U.S. interest rate hikes takes pressure off global peers to keep on raising rates and offers relief to emerging markets, which have suffered their biggest rout in over a decade this year. Central banks around the world have taken their cue from Washington in lifting borrowing costs at record pace. So a signal in the minutes of the Fed’s November meeting that policy tightening will soon slow has global ramifications, from a drop in global yields and rising stocks to a rebound in currencies against the dollar. More importantly, the Fed’s hint suggests that inflation may be coming under control, bolstering hopes of a “soft landing” for the world’s biggest economy that could in turn cushion others, many of which are already in recession. The inflation fight is far from over, especially in Europe, where the energy shock from the Ukraine has hurt most, but the Fed’s shift eases the pressure on central banks to keep moving in big...