The OECD said it expected no further rate cuts in the euro zone. Photograph: Alex Kraus/BloombergLeading economies will end their current rate-cutting cycles by the end of 2026, according to new Organisation for Economic Co-operation and Development (OECD) forecasts that suggest most major central banks have little scope for looser policy despite an expected slowdown in growth. The OECD said it expected no further rate cuts in the euro zone or Canada, but a steady tightening of monetary policy in Japan, where inflation is stabilising at about 2 per cent. In the UK, rate cuts by the Bank of England “will cease in the first half of 2026”, the OECD said, with Australia’s Reserve Bank set to reach a similar point in the second half of the year. Listen | 37:31“In many advanced economies, real policy rates are already close to or within estimated ranges for real neutral rates [at which monetary policy is neither boosting nor squeezing economic growth] and all are projected to be so at the end of 2027,” the OECD said.
