Why it matters
Relative—not absolute—policy paths shape FX, cross-market duration and capital flows.
Evidence ledger
Supporting and contradictory evidence are displayed together. “Strength” is editorial judgment, not probability.
The FOMC held the target range at 3.50–3.75% in July.
Federal Reserve · 29 Jul 2026 ↗The RBNZ raised the OCR 25bp to 2.50% in July after an energy-related inflation shock.
RBNZ · 8 Jul 2026 ↗Falling petrochemical prices could reduce the need for divergent reactions.
RBNZ · 8 Jul 2026 ↗What would change our mind?
Converging sequential core inflation and synchronized forward guidance across major central banks would weaken the theme.
Scorecard—not a black box
Cross-asset implications
| Asset | Bias | Conditional logic |
|---|---|---|
| FX | Dispersion | Rate differentials interact with growth and risk appetite. |
| Local bonds | Dispersion | Policy trajectories differ materially. |
| EM carry | Conditional | Selective where inflation and fiscal credibility align. |
Directional labels are scenario sensitivities, not recommendations or guaranteed relationships.
Scenario set
Base · Selective divergence
Country-specific inflation keeps policy paths apart.
Strengthens · FX feedback
Currency weakness forces more hikes in import-sensitive economies.
Breaks · Synchronized shock fades
Energy normalization restores broad disinflation.
Public change log
Policy paths split.
RBNZ hiked while Fed held.