Following a massive sell-off in U.S. assets last week, new clouds were shrouded in Washington and Wall Street: the U.S. national credit is facing severe tests again. S&P and European rating agency Scope have successively issued warnings to downgrade U.S. credit ratings. S&P said that if fiscal conditions worsen in the future, the U.S. may lose its existing AA+ rating.

At the same time, after falling below the 100 key mark intraday last week, the US dollar index continued to fall this week, and today it fell below the 98 mark, the first time since March 2022. According to Bloomberg, most central banks around the world are preparing to cut interest rates in the coming months to buffer the impact of the trade war initiated by U.S. President Donald Trump on its economy.

Despite variables in policy implementation, Trump's tariff measures have set the outlook for growth everywhere and have also increased the risk of a U.S. recession. The World Trade Organization has predicted that international business activity will decline this year, and the International Monetary Fund will lower its outlook this week.

The White House tariffs could automatically raise prices for U.S. consumers, a question that Fed Chairman Powell promised to keep a close eye on in his speech last Wednesday, which is one of the reasons why Bloomberg's economy does not expect the United States to be significantly easing.

Other central banks around the world will focus on countermeasures and escalation in the trade war to assess the threat of reappearing inflation in their economies. Exchange rate fluctuations brought about by the weak dollar and doubts about the rationality of U.S. decision-making may pose additional challenges to other countries.

Federal Reserve: The current federal funds rate cap is 4.5%, and Bloomberg Economics predicts it to be 4.25% by the end of 2025. The money market has fully priced three times this year, with a 25 basis point cut each time, and there is a possibility of about 60% of interest rate cuts for the fourth time. The probability of a 25 basis point cut in June is 70%, which will be the first rate cut this year.

ECB: The current deposit interest rate is 2.25%, while Bloomberg Economics predicts that it will be 1.75% by the end of 2025. Traders are optimistic that the decline will be three more times this year, with 25 basis points each time, and the next move may be in June.

Bank of Japan: The current target interest rate ceiling is 0.5%, Bloomberg Economics predicts 0.75% by the end of 2025, and is expected to have a 50% chance of raising interest rates by 25 basis points this year. Trump's tariff move shocked policymakers and business executives, and the Bank of Japan's focus has shifted from whether interest rates will be raised in May to whether interest rates will resume this year.

Bank of Korea: The current benchmark interest rate is 2.75%, and Bloomberg Economics predicts 2% at the end of 2025. It has lowered the benchmark interest rate three times since October last year to respond to domestic slowdowns, cooling exports and concerns about Trump's protectionist policies.

Bank of England: The current benchmark interest rate is 4.5%, and Bloomberg Economic forecasts 3.75% by the end of 2025. In terms of market pricing, the market has fully priced 25 basis points in each rate cut three times, and there is a 50% chance of a fourth rate cut.

Bank of Canada: The current overnight loan interest rate is 2.75%, Bloomberg Economics predicts 2.30% by the end of 2025, and traders expect two more interest rate cuts this year to be 25 basis points, a small possibility of the third time.

Russia's central bank : The current key interest rate is 21%, and Bloomberg's economy forecasts 16% by the end of 2025. Despite the small trade volume between Russia and the United States, tariffs may disrupt the Russian central bank's efforts to reduce inflation, and falling oil prices may damage the ruble and push up commodity prices. The central bank may begin a loose turn in the second or third quarter, reducing the current 21% policy rate to 16% by the end of 2025 and to 12.5% ​​by the end of 2026.

The trade war initiated by the Trump administration is like a sudden storm, disrupting the original pace of the global economy, casting a shadow on the economic growth prospects of various countries, and impacting market confidence. Central banks of all countries are working hard to find monetary policy paths that suit their national conditions. Their goal is not only to maintain economic growth, but also to control inflation, stabilize exchange rates, and ensure employment. In this process, the actions of central banks of various countries influenced each other and together formed a grand picture of global monetary policy.