All eyes fixed on central banks this week

It is a week packed with central bank meetings with the US Fed, the European Central Bank and the Bank of England all due to meet. Part of this is to avoid longer-term market interest rates dropping further, effectively loosening monetary conditions. Everyone knows that the odds are firmly stacked in favour of interest rates ending next year lower than they will start it. Strong US jobs figures last Friday will give US Fed chair Jay Powell the cover to kick to touch on interest rate trends. But with headline inflation falling and economic conditions weak, financial markets still expect interest rates to start falling by the summer at the latest.