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Franklin Templeton analysts once again assess the monetary policy outlook for the Group of 10 central banks, as well as China, India and South Korea.

Central banks have been taking a cautious approach to cutting, even before the US government shutdown’s data darkness and President Donald Trump revived tariff threats against China.

When the US Federal Reserve’s Federal Open Market Committee voted 11–1 for a 25 basis point cut in September from 4 to 4.25% – the first since December – policymakers were split on whether to enact one additional 25bp cut by year-end or two more cuts. However, since then, Fed chair Jerome Powell has signalled a more dovish stance in October.

The People’s Bank of China’s change in its description of the economy from “showing positive momentum” to “making strides while maintaining stability” is seen as indicative of its cautious outlook on growth. Nevertheless, Franklin Templeton expects another 25bp reserve requirement ratio and a 10bp rate cut by year-end – a slight downgrade from earlier.