Central banks step up tightening

More central banks around the world are unleashing a greater amount of policy firepower as they seek to combat unrelenting inflationary pressures.

Half percentage-point increases in interest rates are becoming more common, as seen in India and Australia this week. United States Federal Reserve officials next week are forecast to raise rates by 50 basis points as data showed a fresh four-decade-high rate of inflation.

The European Central Bank, however, is taking a more measured approach — at least in the near-term. Against a backdrop of soft economic activity, officials this week indicated they would boost rates a quarter point in…