- Investors considered Federal Reserve Chair Jerome Powell's willingness to accept larger rate rises sooner in the tightening cycle as treasuries fell and equity-index futures extended losses.
- The Nasdaq 100 and S&P 500 indexes fell at least 0.4% each, indicating New York equities could be looking at a third week of declines. Treasury rates on shorter maturities have risen sharply. The dollar soared to its highest level since July 2020, amid the pound's losses, as statistics revealed that the UK's cost-of-living problem is limiting consumer spending.
- Despite the fact that the Federal Reserve and the European Central Bank have taken a more hawkish stance in recent days, equities in the United States have remained resilient thanks to what is shaping up to be another stellar earnings season. Meanwhile, traders are wary of risk repricing, particularly after Powell described his most aggressive strategy to managing inflation yet, potentially recommending two or more half-point rate hikes.
- Traders price in 50 BPS of ECB rate hikes by September.
- UK's Prime Minister Johnson: I have told negotiators to finish a free trade deal with India by November.
- ECB's Holzmann: The ECB should conclude asset purchases as soon as possible.
- Eurozone Money Markets now price in 80 BPS of ECB rate hikes by year-end, up from over 70 BPS on Thursday.
