After the FED decision, before the ECB conference

As expected, the Fed raised key interest rates by 25 bps on Wednesday. The federal funds interest rate target range is now 5,25%-5,50%, the highest since early 2001. The FOMC (Federal Open Market Committee) decision was unanimous.

The Fed left option for further interest rate hikes and made future decisions dependent on the data coming from the economy. This afternoon in the US flash data on GDP in QXNUMX will be released.

Solid employment growth

Fed Chairman Jerome Powell Powell indicated that there will be two more consumer price data releases and two employment reports ahead of the September meeting (which will take place in eight weeks). He said further progress on inflation would be particularly important focusing on core inflationwhich is still quite high.

In the Fed's post-meeting statement, the phrase "Fed now sees modest growth in economic activity" was replaced with "Fed now sees moderate growth in economic activity". As before, the Fed pointed to solid employment growth, low unemployment rate and elevated inflation.

The Fed started its ongoing anti-inflationary campaign by raising rates by 0,75 percentage points. percent Then it went to an increase of 0,5 points. percent., and recently raised rates by 0,25 percentage points. percent It is speculated that a further slowdown in the pace of monetary policy tightening could consist in increases by 0,25 percentage points. percent at every other meeting FOMC.

New cyclical company highs

Today at approx. 9:50 the price of contracts on S & P 500 was the highest since March last year. level (+0,47%).

In Europe approx. 9:40 DAX gained 0,36 percent., and the CAC 40 grew by 0,84 percent.

On the WSE, WIG -20 was making up for yesterday's loss and was around 9:55 am by 0,47 percent above Wednesday's close. The share prices of mBank and Orange Polska were the highest in over a year today. Among the components of sWIG 80, the share prices of TIM and Rainbow Tours reached their new cyclical highs today.

The yield on 10-year US government bonds continued its cautious decline on Thursday morning (3,857 percent). The yield on 10-year Polish government bonds remained at yesterday's closing level (5,447%).

Dollar weakening and ECB decision awaited

The US dollar weakened this morning (EUR/USD 0,32%, USD / JPY -0,11 percent around 9:40). The ECB meets this afternoon another rate hike of 0,25 percentage points is expected. percent.

The Polish zloty strengthened on Thursday morning. The EUR/PLN exchange rate was approaching its lowest level since 2020, reached at the beginning of the month (-0,21 percent around 9:40 am). The USD/PLN exchange rate, which returned below PLN 4 yesterday, fell by 0,6 percent.

Course changes Bitcoin against the US dollar, which fell to the lowest level in a month on Monday, were minimal on Thursday morning (-0,05 percent at around 9:44).

Today in the morning, the prices of crude oil contracts made up for yesterday's losses (WTI +1,07%, Brent +0,86% around 9:35 am). On the other hand, natural gas on NYMEX fell (-0,63%). Metals went up (gold +0,52%, silver +1,01%, platinum +0,79%), palladium +0,15%, copper +0,74%) and contracts for soybeans, wheat and sugar. From its highest since Jan. level decreased by approx. 1 percent. cotton contract price.

Source: Łukasz Zembik, OANDA TMS Brokers