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Hey, quick, how do you say interest rate increase in Turkish?

Anybody know from American public media? This is Marketplace.

In Los Angeles, I'm Kai. Rizdallet is the 22nd of June today.

It is always to have you along. Everybody, the macroeconomic news of this Thursday comes to us by London and Oslo and Bern and Ankara.

The courtesy of the central banks of in order, England, Norway, Switzerland and Turkey, all of which raised their key interest rates today.

It's a pretty good example. I'd say of the tendency that the world central bankers have to do pretty much the same thing at the same time.

And for those listening at this point saying, but Kai, the Fed skipped this past meeting. Well, yes, true they did, but they also promised, all but promised, I suppose, more rate hikes later on this year.

So we asked Marketplaces, Kristen Schwab to explain that herd mentality.

Central banks are often making the same moves because more often than not, economic problems are global problems.

Bill English is a finance professor at Yale.

The central bankers are responding to the same shocks. They're big shocks. And so the appropriate policy is similar.

And what appropriate monetary policy looks like right now is because of the pandemic, supply chain problems and the war in Ukraine.

Since the problems are so similar, there's a sort of group think that happens.

Central banks watch and discuss everyone else's moves with each other, add official meetings and behind closed doors.

Even so, in most packs, a leader eventually emerges.

Bank of England began tightening policy, for example, a few months before the Fed did in response to the high inflation.

It's why the Bank of England's recent rate hike could offer a clue for what's to come in the US.

Bill Emmens is a professor at Washington University of St. Louis, and a former economist at the St. Louis Fed.

I think this points in the direction of saying, oh, the Fed probably has more to do, and it been behind the curve through most of this episode.

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