Financial Markets Daily Report22 setembre 2022
The US Federal Reserve’s meeting centered the stage in a risk-off session, also spurred by the escalation of Russia’s offensive in Ukraine. As expected, the central bank raised policy interest rates by 75 bp while President Jerome Powell said that interest rates will need to stay in restrictive territory for longer, as shown in the dot plot.
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- The US Federal Reserve’s meeting centered the stage in a risk-off session, also spurred by the escalation of Russia’s offensive in Ukraine. As expected, the central bank raised policy interest rates by 75 bp while President Jerome Powell said that interest rates will need to stay in restrictive territory for longer, as shown in the dot plot.
- In particular, most FOMC members expect interest rates to be lifted at least by 1.25pp in the remaining two meetings of the year and project some additional hikes in 2023. Their forecast for unemployment assumes that there will be a necessary cool down in the labor market and below-potential GDP growth.
- In this context, stock indices declined in the US and the dollar strengthened, pushing the euro down below parity.
- Today, the Bank of England and the Swiss National Bank are expected to hike interest rates, while earlier on the Bank of Japan kept its policy stance unchanged.