Story perspectives

Fed Calls Cut, BOE Hikes, Trump Adviser Decries

5/2/2026

Summary

Miran Calls Cut

Stephen Miran (Federal Reserve) issued the only G7 call for a rate cut.
Christine Lagarde (European Central Bank) said officials lacked sufficient data for a June hike.
Huw Pill (Bank of England) voted for an immediate rate increase.
Andrew Bailey (Bank of England) warned waiting would be too late.
Kevin Hassett (White House National Economic Council) called an ECB or Fed hike a policy error, echoing President Donald Trump.

Summary

Banks Hold Rates

Reserve Bank of Australia held its rate at 4.1%, highest among G-10 economies, as Q1 inflation read 4.1%.
Norges Bank kept rate at 4% while inflation stayed near 3%, above 2% target.
Bank of England dropped its single-point inflation forecast and released three scenarios, including a rate hike.
Swiss National Bank left its rate at 0% and will intervene to curb franc that could push inflation below 0-2%.

Summary

Powell Stays

Fed Chair Jerome H. Powell will stay on the Federal Reserve (Fed) board after leaving the chair, mirroring the 1948 Eccles move.
Tokyo, Washington, London and Frankfurt banks kept short-term rates unchanged while inflation rose and growth slowed.
The Fed cited Middle-East developments and the Iran war’s energy shock as uncertainty sources.
Powell’s board stay follows a rocky relationship with U.S. President Donald Trump, prompting analysts to call it “imponderable”.

Summary

ECB Eyes Hikes

Investors price in ECB rate hikes by the end of 2026.
Euro-area inflation rose to 3% because higher energy prices during the Iran conflict.
First-quarter euro-zone growth slowed to 0.1%, reviving stagflation concerns.
ECB deposit rate stays at 2% as the bank awaits June’s revised forecasts.
ECB President Lagarde warned a rate increase will be considered at the June meeting if energy pressures persist.

History

Historical Context

In 1981 Paul Volcker, as Fed chair, raised rates dramatically, sparking a recession but halting double-digit inflation. The same period saw the dollar climb roughly 50 % against the yen, mark, franc and pound, prompting G7 talks at the 1982 Versailles Summit and the 1985 Plaza Accord to curb its strength. Those episodes illustrate how tight policy and international coordination shape today’s G7 central-bank stance.

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Miran Calls Cut

Stephen Miran (Federal Reserve) issued the only G7 call for a rate cut.
Christine Lagarde (European Central Bank) said officials lacked sufficient data for a June hike.
Huw Pill (Bank of England) voted for an immediate rate increase.
Andrew Bailey (Bank of England) warned waiting would be too late.
Kevin Hassett (White House National Economic Council) called an ECB or Fed hike a policy error, echoing President Donald Trump.

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