Why US, UK, and NZ Haven't Raised Interest Rates

Mon 18 May 2026 at 4:57am

Countries are dealing with different issues as they think about interest rates.

Some countries haven't raised interest rates in years, unlike Australia.

The US, UK, and NZ haven't raised rates since 2023, while Japan has had low rates for decades.

Australia's Reserve Bank raised interest rates due to inflation concerns.

It's not easier for borrowers in other countries.

Some countries decide interest rates based on unemployment or currency issues.

We'll look at what's happening with interest rates in other countries.

New Zealand

New Zealand's interest rate is 2.25%, down from 5.5% in 2023.

New Zealand's economy is weaker than Australia's.

New Zealand's property market may slow down this year.

The central bank may raise interest rates.

High fuel costs could affect prices and wages in New Zealand.

Critics say Australia's Reserve Bank shouldn't have cut rates.

New Zealand's interest rate may rise due to inflation.

Inflation may rise to 4% in the June quarter.

The Reserve Bank may start raising rates in July.

United Kingdom

The UK's interest rate is 3.75%, unchanged since April.

The Bank of England is dealing with high inflation.

The BoE's decision to keep rates steady is similar to Australia's rate hike.

The UK's economy is weaker than expected.

Inflation may keep rising due to high energy prices.

The BoE has warned of higher interest rates.

Fixed mortgage rates are rising in the UK.

United States

The US is seeing higher inflation due to the Middle East conflict.

The Federal Reserve's interest rate is 3.5-3.75%.

Inflation has risen faster in the US since the war with Iran.

The Federal Reserve may raise interest rates.

The US interest rate has less impact on homeowners.

The US Senate has confirmed a new Federal Reserve chairman.

The outgoing chairman faced pressure to lower rates.

The Federal Reserve is in a difficult position.

The Iran conflict has increased pressure on the US economy.

Japan

Japan's central bank raised interest rates in 2024.

The interest rate is 0.75%, a three-decade high.

Japan has had low or negative interest rates for decades.

The central bank used low rates to combat weak consumer spending.

The BoJ has paused rate hikes due to the Iran war.

Some BoJ members want to monitor the conflict's impact.

Japan's inflation rate is 1.5%, expected to rise to 2%.

The Japanese yen has fallen to historic lows.

The weak yen is the BoJ's biggest concern.

A weak currency can add to inflation.

The BoJ may raise interest rates to combat inflation.

Indonesia

Indonesia's central bank is balancing growth and currency protection.

The interest rate is 4.75%, part of a balancing act.

Bank Indonesia is trying to support the economy.

The bank has kept interest rates steady.

If rates rise too high, it may slow economic activity.

Bank Indonesia has limited room to cut rates.

The bank may raise rates if the rupiah weakens.

Rates could rise by the end of the year.

Mon 18 May 2026 at 4:57am

Mon 18 May 2026 at 5:58am

Promotion