Global monetary policy may be about to turn slightly restrictive, warns National Bank Financial.

In a research note, NBF notes that global monetary policy was tightened another notch Wednesday with the European Central Bank’s decision to hike its key lending rate to 4%, the highest level since September 2001. “As a result of this action, we estimate that the global policy rate — a weighted average of the main central banks’ policy rates — is now at a six year high,” it says.

“Given that inflationary pressures remain the key concern for most of the central banks, there is room for further hikes in short-term interest rates in the coming months,” NBF adds.

“We estimate that if current market expectations of tightening in Canada, the U.K. and the euro zone are realized between now and the yearend, the global policy rate will rise to a seven-year high by next December,” it says. Should this scenario unfold without acceleration in G7 core CPI inflation, real interest rates could thus breach the 2% mark for the first time since the early 2000.”