Major central banks hike rates by 2,700 bps in 2022
Signs that Bank of Japan could join tightening
Interest rate hikes in emerging economies slowing down further

LONDON, Dec 23 Reuters Major central banks ramped up interest rates at the fastest pace and biggest scale in at least two decades in 2022 as policy makers went all out in the battle to contain surging inflation.

Central banks overseeing the 10 most heavily traded currencies delivered 2,700 basis points bps of tightening in 54 rate hikes over the past 12 months, Reuters calculations show.

All major central banks bar the Bank of Japan raised rates this year, though policymakers in Tokyo roiled markets in December with a surprise policy tweak to its yield target, fuelling speculations that an actual rate hike might be on the cards in the not too distant future.

However, it was primarily the U.S. Federal Reserve39;s 225 basis points of hikes over the past 12 months and the prospect of possibly more to come that has kept markets on edge against a backdrop of sharply slowing growth.

When you look at the tightening in the U.S. it is basically one of the sharpest ever in the past 20 years, David Hauner, head of emerging markets crossasset strategy and economics, EMEA at Bank of America Global Research told Reuters.

Normally when you have such a sharp tightening in financial conditions you basically have something more than just a small recession, which seems now the general consensus.

On a monthly basis,…