The key factors driving markets in the first quarter of the year continued through April. Economic growth has remained resilient, labour markets strong and the earlier falls in inflation have slowed. The long period of high inflation, aggressive monetary tightening and geopolitical uncertainty have not damaged economies as much as was widely forecast. As a result, central banks, led by the Fed, have become more cautious about policy easing and have pushed back on cuts in rates, fearing that premature cuts could result in inflation becoming more entrenched and then requiring renewed policy tightening.
