Fed Rate Increases to Persist Until Inflation Eases, Barkin Says

“Inflation should come down, but I don’t expect its drop to be immediate nor predictable,” said Barkin, who isn’t a voter on the rate-setting Federal Open Market Committee this year. “Significant shocks simply take time to dampen,” he said, referring to the disruptions created by the Covid-19 pandemic, supply-chain snarls, and Russia’s invasion of Ukraine.

UK Market Plunge Sparks Talk of Emergency BOE Rate Hike

“The market is giving very strong signals that it is no longer willing to fund the UK’s external deficit position at the current configuration of UK real yields and exchange rate,” Saravelos wrote in a note, adding the view is his own, rather then the view of Deutsche Bank economists. “The policy response required to … Read more

It’s Every Nation for Itself as Dollar Batters Global Currencies

For starters, China is now the biggest trading partner of the US, Japan and countries across Europe. An agreement without Beijing’s participation would likely be an ineffective deal and while the yuan is under pressure versus the dollar and the government there is leaning against weakness with its fixings, it’s far from distressed levels that … Read more

Key Takeaways From Fed Decision to Raise Rates 75 Basis Points

Here are key takeaways from the Federal Reserve’s interest-rate decision and economic projections on Wednesday: Fed raises its main rate 75 basis points, as anticipated, to a range of 3% to 3.25%, while new projections from officials show a median estimate of 4.4% at the end of 2022 and 4.6% at the end of 2023 … Read more

Fed Seen Raising to 4% in 2022 And Signaling Higher for Longer

“We expect the Fed to continue hiking until realized inflation prints come down, with the August CPI release adding substantial urgency to the Fed’s task,” said Robert Dent, senior US economist at Nomura Securities International Inc.  “The longer inflation stays elevated, the more concerns of a wage price spiral and/or inflation expectations unanchoring rise.”