Lace up your boots, central banks globally are going hiking. US FOMC raised rates 75bps yesterday. Swiss national bank also surprised with a 50bp hike, as did Hungary. BoE raised 25bps in their fifth straight hike. Equities fall and treasury yields surge as markets digest central bankers' moves to cool inflation.
You cannot shake hands with a clenched fist.
June 16, 2022
EUR/USD 1.0460 GBP/USD 1.2256 USD/CAD 1.2947 AUD/USD 0.6969 USD/JPY 132.73 USD/CNH 6.7121 USD/ILS 3.4529 USD/MXN 20.6437 USD/CHF 0.9722 USD/INR 78.075 USD/BRL 5.0569 USD/SGD 1.3878 USD/DKK 7.1104 USD/SEK 10.2410 USD/NOK 10.0494
Dollar stronger despite initially moving lower following yesterday’s rate hike decision. As expected, the Fed raised interest rates by 0.75% in the biggest increase since 1994, and Fed Chair Powell signaled for another large raise next month.GBPSterling initially fell following the rate decision this morning and then moved higher versus both the euro and dollar.EUR
Euro on the backfoot as the dollar moves stronger as markets digest that central bankers are more skittish on the global economy than what they let see.CADCanadian dollar fell versus US counterpart following rate decision. WTI drops near 2%.ASIA/PACIFIC
USD/JPY dropping to a one-week low on stop loss and cross related selling. BoJ announces rate decision tomorrow – and traders bet they may move away from accommodative policy.
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