Fed to tighten aggressively amid ‘key upside risk’ to inflation expectations – Goldman Sachs

Analysts at Goldman Sachs believe that the Fed could be forced to tighten aggressively, in the wake of upside risks to inflation expectations. An upcoming barrage of political advertisements point to high inflation. Key quotes “Potential further increases in food and gas prices are the main upside risk to consumer inflation expectations.” “But another key … Read more

USD/JPY juggles above 136.00 ahead of PMI figures, Japan Inflation in focus

USD/JPY is holding itself above 136.00 as investors are focusing on PMI figures. Costly oil and food prices contaminate Japan’s inflation figure near 3%. Fed Powell is expected to dictate a consecutive 75 bps interest rate hike in July. The USD/JPY pair is displaying back and forth moves in a narrow range of 136.10-136.30 in … Read more

Inflation likely to get worse before it gets better in 2022

Australian Treasurer Jim Chalmers said on Wednesday that he expects inflation to reach its highest level in 32 years by the end of 2022, calling for more interest rates from the Reserve Bank of Australia (RBA) before Christmas. Key quotes ‘We’ll see that later. Certainly, the expectation across the board is that inflation will get … Read more

Fed to lift rates by 75 basis points in July, 50 bps in September – Reuters poll

The Federal Reserve (Fed) will deliver another 75-basis-point interest rate hike in July, followed by a half-percentage-point rise in September, and won’t scale back to quarter-percentage-point moves until November at the earliest , according to economists polled by Reuters. Key findings The latest poll results, released on Wednesday before Fed Chair Jerome Powell was due … Read more

GBP/JPY tumbles below 167.50 ahead of UK Inflation and BOJ’s minutes

GBP/JPY has displayed a momentum loss on higher forecasts for the UK Inflation. The BOJ minutes will disclose the secret behind keeping a neutral stance on the interest rates. The annual inflation rate of 2.9% in Japan is majorly contributed by soaring oil and food prices. The GBP/JPY pair has witnessed a steep fall in … Read more

Forecasts from six major banks, vigilant on external risk

Bank Indonesia (BI) will hold the monthly governor board meeting on 22-23 June. Here you can find the expectations as forecast by the economists and researchers of six major banks regarding the upcoming central bank’s decision. The BI is expected to hold its benchmark seven-day reverse repurchase rate unchanged at 3.50%, however, there is still … Read more

China’s LPR still has downward space in H2 – Herald

“China’s financial regulators are likely to guide down banks’ capital costs to drive down their Loan Prime Rate quotations in H2, thereby reducing the loan interest rates for enterprises and residents,” the 21st Century Business Herald reported, citing analysts. Additional comments “LPR, based on the rate of PBOC’s medium-term Lending Facility and quotations submitted by … Read more

Committed to doing what is necessary to ensure inflation returns to target over time

Reserve Bank of Australia (RBA) June monetary policy meeting’s minutes showed that board members remained committed to doing what is necessary to ensure that inflation in Australia returns to the target over time. Additional takeaways Agreed that further steps would need to be taken to normalize monetary conditions in Australia over the months ahead. Inflation … Read more

Central bank does not target specific spread levels for indebted countries

European Central Bank (ECB) does not target specific spread levels for indebted countries, the central bank policymaker Martins Kazaks told Reuters on Monday. Additional quotes “But we try to ensure proper transmission.” “Difficult to see rise in spreads as driven by changes in fundamentals.” “Investors shouldn’t get carried away with rate hike bets.” “Would support … Read more

There is a great determination to deal with fragmentation risk

European Central Bank (ECB) Governing Council member Mario Centeno said on Monday that there is a great determination to deal with fragmentation risk. Additional comments Instruments against fragmentation only to be used in case of need, hope won’t be used at all. We are discussing instruments (against fragmentation) that allow to bring discipline to the … Read more