Further interest rate hikes are likely across the region in the near term, and we have raised some of our year-end forecasts to reflect growing concern among the region’s policymakers about inflation. However, with economic growth likely to slow over the coming months and inflation set to fall back sharply by the end of the year, tightening cycles are likely to be short lived. We think most central banks will be finished hiking rates by early 2023. In contrast, the consensus and financial markets are expecting tightening cycles to continue well into next year.
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