Skip to main content
  • Wealth management
  • Asset management
  • Wealth management
  • Asset management
  • MyRathbones login
  • Financial Planning login
  • Donor Advised Fund login
Home
  • Who we help
    Who we help

    We help a wide range of clients invest well so that they can focus on what matters

    Who we help
    • Individuals and families

      Focusing on you and your individual goals

    • Business owners and entrepreneurs

      Helping turn the success of your business into financial security for your family

    • Financial advisers

      Working with you, for your clients.

    • Charities

      Helping charities invest in line with their mission and values

    • Professional partners

      We work with lawyers, accountants and other professionals.

  • Our services
    Services

    See our wide range of services tailored for your needs

    Our services
    • Investment management

      Looking for someone to create an investment portfolio for you?

    • Wealth management

      Our combined investment and planning service for a holistic approach to your finances

    • Financial planning

      Need help reorganising your finances and planning for the future?

    • Asset Management

      Looking to invest in a fund? See our full range

    • Tax and trust

      Helping you pass on your wealth, manage a trust or gift to charity

    • Greenbank sustainable investing

      Looking for investments that align with your values? See our sustainable investment options

  • About us
    About us

    A top 3 UK wealth manager with roots dating back to 1742

    About us
    • Careers

      Learn more about what it’s like to work at Rathbones, and search our current vacancies

    • Corporate governance

      Explore our reports and accounts which ensure we comply with the UK Corporate Governance Code

    • Investor relations

      Find the Rathbones plc financials, investment case and key events

    • Media centre

      Read the latest Group news

    • Our purpose

      Our driving purpose is to help more people invest well, so they can live well

    • Responsible business

      We believe in doing the right thing for our clients and for others too

  • Insights
    Insights

    Read the latest news and market commentary from our specialists

    Insights
    • Financial planning

      Explore a range of topics effecting your finances, from retirement planning to the latest legislative changes

    • Investing

      Read about the key investment themes effecting global markets

    • Podcasts

      Listen to our specialists in one of our podcasts: Inspired sounds, Inspired minds, or Financial planning unlocked

    • Responsible investing

      Explore our articles, reports and events on Responsible Investment

  • Contacts
    Contacts

    Whether you have a question about our services, or need to talk someone specific, we can help

    Contacts
    • Our offices

      Find your local Rathbones office. We have 21 across the UK and Channel Islands.

    • Our people

      Find the contact details for your Rathbones team by searching our people’s directory.

    • Let's talk

      Our team will be in touch to help you book a no obligation consultation with an adviser.

    • Other contacts

      Need to contact us about something else? Here you'll find all the options

Let's talk

Search

Review of the week: Skip, hop and jump?

12 June 2023

All eyes are on the direction of central bank monetary policy. After expecting a policy pivot, investors now think the most likely outcome is a skip in tightening followed by a hop to pause mode before a jump to interest rate cuts.

Article last updated 22 July 2025.

Quick take

- Will the Fed skip a rate hike this month? 

- And might it then hop towards a lengthy policy pause before a jump to rate cuts?

- Expect a lot of political noise as former US President Donald Trump goes to court on federal criminal charges and we learn more about former Prime Minister Boris Johnson’s abrupt exit from Parliament. 

It’s a big week for some of the world’s biggest central banks. First up, we get the US Federal Reserve (Fed)’s latest interest rate decision on Wednesday, followed by the European Central Bank (ECB) on Thursday and the Bank of Japan (BoJ) on Friday. 

Earlier this year investors were firmly focused on the idea of a Fed pivot away from its super-aggressive rate increases and towards significant rate cuts from mid-year. But over the last few months they’ve shifted away from expectations of a sharp pivot to rate cutting and have been pricing in a more gradual policy shift. They now seem to be endorsing the idea that the Fed’s next move is most likely to be a skip – a temporary pause in policy tightening that leaves the door open for more hikes if necessary. 

Skipping this time around would give the Fed around six weeks before its July meeting to consider how the economy is holding up, with the next round of labour market and inflation data coming in the gap. A skip might also allow the Fed to get a sneak peek at US second-quarter GDP figures ahead of the July meeting. 

Fed Governor and vice chair nominee Philip Jefferson and Philadelphia Fed President Patrick Harker recently suggested we might have to wait a bit longer for this cycle’s rates peak. Both these voting Fed-members stressed that a potential pause in June wouldn’t signal that the Fed’s tightening cycle had come to a definitive end.

Policy expectations have moved a lot since banking sector turmoil erupted in early March with the collapse of Silicon Valley Bank. Back then, most investors thought there’d be a sharp pivot to Fed cuts by the summer because they feared an imminent banking crisis. Those fears now seem to have been averted – and expectations of a pivot have been pushed out later and later into this year. In fact, bets on a pivot at all by year-end are now hanging by a thread. 

For now, investors seem to be pricing only about a 30% chance of a Fed hike on Wednesday, though conviction in a skip was tested by surprise rate hikes from the central banks of both Canada and Australia last week. These seemed to counter hopes that most big central banks are on the verge of concluding their rate hikes, particularly since the Bank of Canada was one of the first formally to signal a likely pause in tightening back in January. 

We should get a clearer sign on where the Fed is headed when the latest US inflation figures covering May are released on Tuesday. US consumer price inflation (CPI) is expected to have fallen from 4.9% in April to 4.1%, though core CPI excluding food and energy prices is likely to be stickier, down from 5.5% in April to a consensus estimate of 5.3%. 

As long as the data don’t show a definitive reacceleration in the labour market and the pace of inflation, our view is that after a skip this week, the Fed will hike again once more and then hop towards a prolonged policy pause before finally cutting rates late this year or early in 2024. 

For its part, the ECB is expected to raise rates by another quarter percentage point on Thursday even though the Eurozone’s official shift into recessionary territory (marked by two consecutive quarters of contracting GDP) was confirmed last week. And the BoJ is expected to stay on hold. 

 Index 1 week 3 months 6 months 1 year
FTSE All-Share -0.4% -2.7% 3.2% 3.8%
FTSE 100 -0.5% -2.8% 3.3% 5.1%
FTSE 250 -0.2% -2.0% 2.5% -1.9%
FTSE SmallCap 0.3% -0.9% 3.0% -3.5%
S&P 500 -0.4% 4.3% 7.7% 8.5%
Euro Stoxx -1.0% -2.6% 9.5% 13.4%
Topix 1.3% 0.7% 10.1% 11.5%
Shanghai SE -1.4% -8.7% -4.0% -6.7%
FTSE Emerging  1.0% -2.6% -0.2% -3.5%

Source: EIKON, data sterling total return to 9 Jun

These figures refer to past performance, which isn’t a reliable indicator of future returns. The value of investments and the income from them may go down as well as up and you may not get back what you originally invested.

Bad week for big political hitters

Meanwhile, it’s shaping up to be a tumultuous week in politics as big hitters both sides of the pond try to defend their reputations in the face of damning allegations. Former President Donald Trump is due in court on Tuesday to face 37 charges, most of them relating to claims he improperly held on to highly classified documents after leaving office. It’s the first time in US history that a former President who is also running against the sitting President has faced federal criminal charges. Unsurprisingly, he’s fighting back hard, claiming the charges represent “horrific abuses of power”.  

Former Prime Minister Boris Johnson seems to be following Mr Trump’s lead and vociferously airing a litany of grievances as his fortunes turn. The Parliamentary investigation into claims he misled Parliament about breaches of COVID rules when in office is due to report its findings this week. After receiving a confidential copy of the report on Friday, Mr Johnson abruptly resigned from the House of Commons. The committee had the power to force Mr Johnson into a by-election to hold on to his constituency – a contest he might well have lost. He seems to have pre-empted that move by quitting on Friday, but has claimed the investigation was a “witch hunt” aimed at forcing him out of politics. 

Mr Johnson clearly faces less immediate legal problems than Mr Trump. But his political fortunes may be less promising, at least in the short term. Mr Trump commands a healthy lead in the polls of Republican primary candidates and the latest historic legal actions against him could deliver a boost of energy, and potentially donations, to his presidential bid. It’s happened before.

If you would like to hear more about what’s going on in the global economy and how it affects the way we invest, please join us for our next Investment Insights webinar on Tuesday 11 July at 12.30pm. You can register here.

If you have any questions or comments, or if there’s anything you would like to see covered here, please get in touch by emailing review@rathbones.com. We’d love to hear from you.

Download PDF

 

Bonds

UK 10-Year yield @ 4.24% 
US 10-Year yield @ 3.74% 
Germany 10-Year yield @ 2.38% 
Italy 10-Year yield @ 4.12% 
Spain 10-Year yield @ 3.36%

Central bank interest rates

UK: 4.50% 
US: 5.00-5.25% 
Europe: 3.75% 
Japan: -0.10%

Key economic data for week commencing 12 June

Tue 13 Jun

UK: April unemployment and average weekly earnings 
US: May CPI  
EU: German and Spanish CPI for May, German ZEW survey for June

Wed 14 Jun

UK: March-April GDP 
US: Fed rate decision, May PPI

Thu 8 Jun

US: Initial jobless claims, Philadelphia June manufacturing survey 
EU: ECB rate decision

Fri 15 Jun

EU: May CPI

Popular Articles

The cover illustration of Investment Insights Q3 2025

1 min

7 July 2025

Investment Insights Q3 2025

Investment Insights Q3 2025
9341_multi-asset_webinar_cm.jpg

1 min

14 May 2025

Multi-Asset Webcast | May 2025

Multi-Asset Webcast | May 2025
Black wire-framed spectacles, a white calculator and a gold pen lie on a light blue accounting ring-binder folder

6 mins

6 May 2025

Review of the week: End of an era

Review of the week: End of an era
Most Read
  1. Investment Insights Q3 2025

  2. Multi-Asset Webcast | May 2025

  3. Review of the week: End of an era

  4. Weekly Digest: A trail of debris

  5. Don't bet the house: Why the Golden Age of UK property investment is over

Let's talk

Ready to start a conversation? Please complete our enquiry form, we look forward to speaking with you

Enquire
Rathbones Logo
  • Important Information
    • Modern Slavery Statement
    • Important Information
    • Complaints
    • Privacy
    • Accessibility
    • Climate reporting
    • Cookies
    • Update cookie preferences
    • Sitemap
  • Important information 2
    • Financial Services Compensation Scheme
    • Banking services
    • Consumer duty manufacturer request for information
    • Financial Ombudsman Service
    • Interest Rates
    • Keeping you safe
    • ScamSmart
    • Status of our websites
Address

Rathbones Group Plc
30 Gresham Street
London
EC2V 7QN

© 2025 Rathbones Group Plc
Incorporated and registered in England and Wales.
Registered number 01000403

Follow us
  • Facebook
  • Instagram
  • LinkedIn
  • X
  • Youtube

The value of your investments and the income from them may go down as well as up, and you could get back less than you invested.