Fed meets for final time in 2022
Today's news headlines:
'Fed to downshift while signalling higher peak'. The Federal Reserve looks all but guaranteed to hike interest rates by 0.5%, with Chairman Jerome Powell expected to reiterate the central bank's position on the fact the terminal rate could be higher than previous projections. We will also be provided with the updated dot plot, which shows policymakers' expectations for rates into 2025, as median estimates currently sit at a terminal rate of 4.9% next year. (Bloomberg)
'UK inflation eases in sign living cost squeeze is past peak'. UK CPI clocked in at 10.7% YoY in October, 0.2% lower than estimates in a sign that inflation could well be starting to peak. This marginal slowdown is not expected to move the needle on future Bank of England interest rate decisions, with a 50 basis point hike widely expected at tomorrow's meeting. Still, the slowdown is welcome for many in the UK as the country continues to battle with sky-high energy and food prices. (Bloomberg)
Equities are mixed this morning, with Europe trading lower and US futures making marginal gains ahead of the Fed meeting later today. The Dollar is flat on a trade-weighted basis as US treasury yields decline.
UK CPI YoY (Nov): 10.7% (est. 10.9%)
UK Core CPI YoY (Nov): 6.3% (est. 6.5%)
Eurozone Industrial Production MoM (Oct): 10:00AM
US Crude Oil Inventories: 3:30PM
Federal Reserve interest rate decision: 7:00PM
New Zealand GDP QoQ (Q3 2022): 9:45PM
GBP/USD – 1.2369
GBP/EUR – 1.1631
EUR/USD – 1.0634
USD/CAD – 1.3543
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*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.