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Few economists had expected Australia to raise its main cash rate to 4.75 percent.
The bank was also forced to raise its main interest rate from 5.5% to 7% – the largest hike since financial crisis ruined Russia in 1998.
According to the International Bureau of Fiscal Documentation (IBFD), an Amsterdam-based group that follows international tax developments, no country plans to raise its main corporate levy.Despite spiralling budget deficits and the widespread belief that corporate greed precipitated the credit crunch, governments do not seem inclined to call on businesses to fill their empty coffers.
Its decision to raise its main policy rate from 7.75% to 8% has been presented by Raghuram Rajan, its new boss, as part of a new plan to shift the RBI towards an orthodox inflation-targeting regime, away from the current ad hoc approach.
Most economists expect the Indian central bank to raise its main interest rate a quarter-percentage point at its review June 16, after it raised its key rates by a bigger-than-expected half-percentage point in May and said it was willing to sacrifice a bit of growth to tame inflation.
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The minutes of its policy meeting on October 6th, at which it raised its main interest rate, revealed the exchange rate was not a consideration.
It raised its main interest rate to 4.25% on July 3rd to show that it was serious about controlling inflation, which is well above its target ceiling of 2%.
The central bank for the 15-nation euro zone surprised analysts in July by raising its main rate by a quarter point, but it stood pat in August.
In a surprising move at a time of global economic weakness, the Hungarian central bank raised its main rate of interest by 3.0%, to 11.5%, as it attempted to stanch an investment outflow and give support to its forint currency, which has plummeted in recent weeks.
Spain is reversing its fiscal stimulus by raising its main value-added tax rate next year.
Alexandre Tombini remains head of the Central Bank, which raised its main interest rate by half a percentage point this week.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com