Central Banks Diverge as Fed Prepares to Ease, ECB Holds, and BoJ Turns Hawkish

Robeco’s Central Bank Watcher (September 2025), by Martin van Vliet, Rikkert Scholten, and Phil McNicholas, analyzes global monetary policy dynamics across major economies.

• The Fed is expected to cut 100 bps by spring 2026, but inflation risks and political pressure limit aggressive easing.

• The ECB signaled a prolonged pause, with cuts unlikely unless new shocks emerge, while balance sheet reduction continues.

• The BoJ faces persistent services inflation, likely bringing forward its next hike, while the PBoC maintains a cautious easing stance.

How should investors position amid diverging central bank paths? Explore the full report for tactical implications.