Fed will tighten the screw! What will the week bring?

The highlight of the past week was the publication of data on consumer inflation in the United States. The higher-than-expected CPI reading surprised the market, which led to significant drops in the valuation of American indices, as well as an increase in the valuation of the US dollar. A stronger USD is not helping the valuation EURUSDalthough from a monetary policy perspective, the main currency pair should bounce back from the parity area. The single currency, however, is burdened with concerns about a strong slowdown and the energy crisis in Europe.

The Fed will raise rates despite the recession

The situation on the EURUSD chart is interesting because this week the FOMC will make a decision on interest rates. After last week's data, the market expects a hike of 75 bp and the target level of interest rates Fed is valued at 4,5%! This is bad news for gold, which broke an important support zone last week, and for the US stock market. Statistically, the market reaction on the second day after the interest rate hike in the US remains negative for the indices. Although there are voices on the market that American stocks are already valued at sufficiently attractive levels, the current indications of economic situation measures and sentiment indices suggest further declines.

We invite you to a webinar with the Chief Economist XTB Dr. Przemysław Kwiecień, in which he will focus on the key topic of recent days - will the Fed tighten the screw?

In today's video:

• When is the dollar peak? What's next for the euro?
• Energy crisis - is there a price peak on us?
• Are the valuation of MSCI Emerging Markets stock attractive?

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In addition, due to the very dynamic situation in the world, additional ones will be made available raports Video on the impact of war, pandemic and economic crisis on the global economy.

About the host

Dr Przemysław Kwiecień - Chief economist X-Trade Brokers. Doctor of Economics at the University of Warsaw, graduate of the University of Warsaw and London Metropolitan University (MSc). Holder of the prestigious CFA certificate. He has been working for XTB since 2007, previously he gained experience as an advisor to the Minister of Finance, Mirosław Gronicki, and an economist at Bank Millennium. At XTB, he manages the Analysis Department.

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