A busy week for central banks come to an end with plenty of rate hikes, increased prospects of slowing growth, that leave investors with a bad taste in their mouth.

The Swedish Riksbank was the first major central bank to surprise with a 100bp rate hike.

The US Federal Reserve (Fed) delivered its third 75bp hike. But the dot plot hinted at another jumbo hike before the year-end.

The Bank of Japan (BoJ) maintained its policy rate unchanged at -0.10%, but intervened directly in the FX market to buy yen to fight back the strengthening dollar.

The Swiss National Bank (SNB) raised its policy rate by 75bp.

The Bank of England (BoE) opted for a 50bp hike, combined with an £80 billion Quantitative Tightening, and said the UK is now in recession. The UK will reveal the ‘mini’ budget today.

Norges Bank also increased its policy rate by 50bp but signaled that tightening may be coming to an end. Indonesia and the Philippines also hiked by 50bp. Taiwan raised by a modest 12.5% as expected, Vietnam opted for a 100bp hike, South Africa raised by 75bp…

…and Turkey… cut its rate by 100bp for the second consecutive meeting!

But the week is not over. The Italian elections due Sunday will likely continue pressuring the euro lower. 

This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

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