(Bloomberg) -- Here are the key takeaways from a panel featuring Federal Reserve Chair Jerome Powell, European Central Bank President Christine Lagarde, Bank of England Governor Andrew Bailey and Bank of Japan Governor Kazuo Ueda at the ECB Forum on Central Banking in Sintra, Portugal, Wednesday:
- The persistence of inflation was a major theme for Bailey, Lagarde and Powell, who all pointed to the strength of underlying prices so far, and how they are adapting policy to that. Lagarde said the ECB will have to be as persistent as inflation is going to be, Powell indicated that more tightening is what the Fed expects and Bailey said strong inflation drove the BOE’s decision to hike by 50 basis points earlier this month.
- The three central bankers also said their institutions are now moving on a meeting-by-meeting basis, taking data into account as they determine what policy is appropriate. Lagarde reiterated that the ECB is likely to hike again in July, though refrained from committing to the direction of policy in September.
- Governor Ueda, who garnered a lot of laughs from several witty comments, said underlying inflation in Japan is still below 2%, but that if there are signs it’ll pick up next year, the BOJ is ready to shift policy, potentially even as soon as this year.
- Tight labor markets and strong consumption are a central theme across the four countries. The central bankers said that while they’re closely monitoring their respective economies, they don’t necessarily see a recession as the most likely outcome of their aggressive policy tightening. They all emphasized that they’ll do what is necessary to fulfill their inflation mandates, with Powell noting that it’s what society expects of central banks.
- US equities edged higher as the central bankers spoke, with the S&P 500 and Nasdaq 100 briefly hitting session highs before paring back. US Treasury yields were slightly lower across the curve, and Bloomberg’s gauge of dollar strength rose to an intra-day high.
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