The Organization for Economic Co-operation and Development (OECD) has projected that major economies around the world will conclude their cycle of interest rate cuts by next year. This outlook suggests that central banks in these countries are nearing the limits of their monetary policy adjustments, with little room left to further loosen policies to stimulate growth.
According to the OECD, the global economic landscape is becoming increasingly constrained, and policymakers are approaching the end of their rate-cutting strategies. The organization highlighted that many leading economies, including the United States, Eurozone countries, and others, have already implemented significant reductions in interest rates over recent years to support economic recovery and combat inflationary pressures.
Experts note that the limited scope for further rate cuts reflects the current state of monetary policy in these regions. Central banks are now more cautious, focusing on maintaining financial stability rather than aggressive stimulus measures. This shift indicates a potential transition towards other policy tools to sustain economic growth.
The OECD also emphasized that the room for further policy easing is minimal due to already low interest rates and rising concerns about financial stability. As a result, countries may need to explore alternative strategies, such as fiscal policy adjustments or structural reforms, to foster economic resilience.
Overall, the forecast underscores a significant turning point in global monetary policy, with the era of rate cuts likely coming to an end in the world's leading economies. Policymakers and investors alike will need to adapt to this new phase, which could influence global financial markets and economic trajectories in the coming years.