The hawkish stance at yesterday’s FOMC meeting led to a sell-off in the US stock market. The Nasdaq lost 1.53% on a daily basis, and the S&P500 alone lost nearly 0.94%. The best performer on the day was the Dow Jones, which lost just 0.22%.
The Fed kept interest rates unchanged and presented a more hawkish dot-plot chart that may suggest one more hike this year and fewer cuts in 2024.
Asia-Pacific markets in today’s session are directly extending the sell-off seen in the US – the Nikkei lost 1.25%, the Kospi lost 1.57%, the Nifty 50 fell 0.70% and the Hang Seng lost 1.38%.
European index futures point to a lower opening of the session on the Old Continent.
Investors’ attention today is focused on the decisions of five central banks, which could significantly affect today’s FX market volatility.
At 08:30 a.m. BST we will learn the SNB decision, and at 12 a.m. BST the Bank of England decision.
The USDIDX dollar index maintained its gains after yesterday’s FOMC decision, with the USD/JPY pair breaking out to levels of 148.45. Antipodean currencies recorded clear declines at the beginning of the session.
On the other hand, during the Japanese session we saw a verbal intervention by Secretary Matsuno, who communicated that no options will be ruled out on ensuring currency stability.
An Australian industry arbitrator says Chevron and unions are close to reaching an agreement on recent wage strikes, which have supported gas prices (especially in Europe).
New Zealand’s Q2 GDP grows stronger than expected. On a quarterly basis, GDP grew by 0.9% against forecasts of 0.4%. Previously, the quarterly growth rate was -0.1%.
Goldman Sachs raised its Brent crude oil forecast to $100
