Rich World’s Rate-Cut Momentum Is Fading

The final wave of monetary policy decisions in 2025 is expected to underscore a growing reality: the easing cycle across advanced economies is either losing momentum or has effectively run its course.

What began as a year marked by cautious optimism—centered on a sequence of modest interest-rate cuts—is now ending with central banks stepping back. Policymakers are shifting from action to assessment, evaluating how earlier easing is filtering through economic growth, labor markets, and inflation dynamics.

Rather than pushing ahead with further cuts, many central bankers appear content to pause, signaling a more data-dependent stance as uncertainties around inflation persistence and economic resilience remain.