The Fed lowers interest rates and the ECB keeps them the same; how does this affect our investments?

This week has been marked by meetings of several central banks and by the meeting between Donald Trump and Chinese President Xi Jinping, who continue trying to reach an agreement to avoid the application of new tariffs.

In any case, over these seven days, three key words have been the main focus: interest rates . “The Federal Reserve has reduced the range of official interest rates to 3.75%-4%, just as the market expected,” says María Contreras , co-manager of Santander Fixed Income at Santander Asset Management .

Despite the lack of economic data —due to the partial government shutdown—the central bank has taken into account the increased pressure in the labor market and the fact that inflation remains under control, even with current rates. In the press conference following its meeting, Jerome Powell emphasized that a further rate cut at the December meeting is not guaranteed. Furthermore, the Federal Reserve has moved up the completion of its balance sheet reduction process to December 1st.

The Fed hasn't been the only one to make moves, as "the Bank of Canada also cut rates by 0.25 percentage points, bringing them to 2.25%, and warned that further reductions may be necessary in 2026." Meanwhile, the Bank of Japan kept rates at 0.50% for the sixth consecutive meeting, despite the rebound in inflation reported the previous week.

Across the Atlantic, the European Central Bank (ECB) has maintained interest rates at 2%, in line with its September decision. “The data remains stable, and the ECB appears to be opting for caution, awaiting further information before taking action. No new economic forecasts were published at this meeting.” Now, “the market assigns only a 50% probability to a further rate cut in the short term.”

Oil prices continued to fall amid rumors of a possible production increase by OPEC.

In the markets, the price of oil continued to fall amid “rumors of a possible production increase by OPEC.” Gold, meanwhile, which had recently reached a record high, has experienced significant volatility: after a sharp rise, “it has seen profit-taking in recent days.”

In this scenario, as usual, "having diversified portfolios adapted to the risk profile and investment horizon of each client is key to meeting investors' long-term return expectations."

This week has been marked by meetings of several central banks and by the meeting between Donald Trump and Chinese President Xi Jinping, who continue trying to reach an agreement to avoid the application of new tariffs.