Financial Markets Daily Report11 October 2023
Investors’ concerns over economic growth outlook ahead, and the decrease in the probability of an additional interest rate hike from the US Federal Reserve this year were the main drivers in yesterday’s session.
- Investors’ concerns over economic growth outlook ahead, and the decrease in the probability of an additional interest rate hike from the US Federal Reserve this year were the main drivers in yesterday’s session.
- On the one hand, the IMF released its October WEO, where GDP growth has been revised down for the euro area (to 0.7% and 1.2% in 2023 and 2024, respectively) and for China (5.0% and 4.2%). In the US, nevertheless, the resilience shown throughout this year has pushed its economic projections up to 2.1% and 1.5%.
- On the monetary policy side, Atlanta Federal Reserve Bank President Raphael Bostic suggested that there is no need to hike interest rates in the coming meetings, as the policy stance is already sufficiently restrictive.
- In this context, yields on sovereign bonds plunged while stock indices rose across the board. In FX markets, the euro strengthened against most currencies and fluctuated above $1.06.