World Central Banks Signal Victory Over Inflation Is in Sight

The European Central Bank and the Bank of England held interest rates steady as rich countries’ central banks begin to reposition themselves for a world in which inflation is under control. The shift marks a turning point for a global economy that for months had been laboring under high interest rates, high inflation and—outside the U.S.—low growth amid heightened geopolitical uncertainties as the wars in Ukraine and Gaza rage on. Faster-than-expected declines in inflation over recent months and signs that economic growth and labor markets are cooling on both sides of the Atlantic have led to a rapid rethink among major central banks, which had until recently signaled a lengthy period of high rates.