Financial Markets Daily Report 14 June 2022
Financial markets started the week with another sell-off session in which traders increased their demand for safe-haven assets. The higher-than-expected US inflation reading is still weighing on sentiment and investors raised their bets for a 75bp interest rate hike from the US Federal Reserve this Wednesday.
- Financial markets started the week with another sell-off session in which traders increased their demand for safe-haven assets. The higher-than-expected US inflation reading is still weighing on sentiment and investors raised their bets for a 75bp interest rate hike from the US Federal Reserve this Wednesday.
- This expectation for a more aggressive monetary policy stance pushed sovereign interest rates markedly upwards. The 2-year US Treasury rose by 29bp towards 3.35%, a level not seen since 2007, and briefly rose above the 10-year benchmark. In the euro area, core rates rose sharply and peripheral spreads widened.
- In stock markets, volatility increased further and losses were generalized across the board. The US dollar strengthened against most currencies and the euro fluctuated around $1.04.
- Today the focus will be on a speech by the ECB Governing Council member Isabel Schnabel.