Interest-rate swaps continue to show policymakers will reduce rates by a quarter-point at the October and December meetings. 

The global economic watchdog warned that UK inflation could be even higher than its latest forecasts that showed consumer prices rising 3.4 per cent this year and 2.5 per cent in 2026.

“It is too early to say with confidence if the comments will trigger the next phase of the trade conflict between the US and China or more negotiating in public, but investors have chosen a wait-and-see tactic.”

Across the region, growth is likely to be slightly lower than last year, but still fairly resilient.

Federal funds futures contracts suggest investors see rate cuts likely in October and December.

“All in all, with no retaliation and an appreciating exchange rate, tariffs have had little inflationary impact so far, with their adverse effects mainly limited to growth,”

Nonetheless, growing interest in other asset classes points to a common theme: Beijing is committed to supporting the economy, and the US trade war will only embolden China’s industrial strength.

Markets are strongly betting on a rate cut in October, though there’s a bit less enthusiasm for another move in December.

Eurozone inflation probably jumped to a five-month high in September, a reading that may reinforce policymakers’ resolve to avoid cutting interest rates again for now.

The nation’s four biggest banks offer returns of around 1.3 per cent for five-year savings accounts, down from around 2.75 per cent in 2020, according to state media reports.

Analysts had not expected interest rates, which influence borrowing costs and returns on savings, to be cut given that prices are rising at nearly twice the Bank's target rate.

The Federal Reserve cut its benchmark interest rate Wednesday for the first time since December and signaled more cuts are likely this year.