Financial Markets Daily Report23 February 2023
Central bank communication continued to center the stage on Wednesday. The release of the minutes of the last Fed meeting showed that almost all FOMC members favored a 25bp rate hike, while just a few would have opted for keeping the 50bp pace. They noted that, despite remaining elevated, inflationary pressures had begun to moderate.
- Central bank communication continued to center the stage on Wednesday. The release of the minutes of the last Fed meeting showed that almost all FOMC members favored a 25bp rate hike, while just a few would have opted for keeping the 50bp pace. They noted that, despite remaining elevated, inflationary pressures had begun to moderate.
- In Europe, François Villeroy de Galhau sounded dovish by saying that financial markets could have overreacted, noting that the ECB might not need to raise rates in every meeting up to September and that the depo rate at 2.5% is already restrictive. Christine Lagarde said that for now wage increases are not consistent with a wage price spiral.
- In this context, yields on sovereign bonds edged modestly down and most stock indices declined, except for the US Nasdaq. The euro weakened against the US dollar and fluctuated below $1.07.
- Today the focus will be on the second estimation of the US Q4 GDP and the final January HICP data in the euro area.