A look at the main events of the past week

The US Federal Reserve is set to raise interest rates

Expectations of the third rate hike by the Bank of England

We will follow up on different data during the week

After US inflation data and the European Central Bank meeting topped the events of last week, attention is turning during this week’s sessions to the US Federal Reserve, Bank of England and Bank of Japan meeting to determine monetary policy, as the Bank of England and the Federal Reserve are expected to raise interest rates by a quarter point, while The Bank of Japan is unlikely to make any change at this week’s meeting.

In a quick look at the most important events of the past week, in which the Russian-Ukrainian war also dominated the market sentiment and the general situation, the European Central Bank accelerated the pace of easing bond purchases in an unexpected step to speed up raising interest rates in light of this situation to support the rises of the euro.

Interest rates unchanged (fayezalajmi-4x.com) On the other hand, inflation in the United States of America recorded its highest level in forty years in February, a few days before the meeting of the US Federal Reserve, affected by the rise in commodity prices after the Russian-Ukrainian war.

Annual inflation in the United States of America at its highest level in forty years (fayezalajmi-4x.com) .

On the other hand, the Canadian economy added jobs in February, exceeding expectations, and unemployment rates fell to the lowest levels since May 2019 The Canadian economy added 337 thousand jobs in February, and the unemployment rates are the lowest since May 2019 (fayezalajmi-4x.com)

The general index of the US dollar, after rises and declines during the week, was able to record weekly gains of about 0.50%, benefiting from the inflation data by the end of the week, to close the session at 99.10 levels, and it is trading at 99.15 levels on Monday morning.

The US Federal Reserve is on top of the week’s events

The US Federal Reserve, which meets on March 15-16, and will announce the results of its meeting at the end of the American session on Wednesday, March 16, tops the central bank meetings during the week because it is the largest central bank in the world and its decisions affect the rest of the central banks, especially emerging ones.

The Federal Reserve is expected to raise interest rates by a quarter point (25 basis points), and this percentage of the hike is fully calculated in the markets.

The rate for the US Federal Reserve to raise interest rates by 50 basis points in this meeting was more than 80% before the Russian-Ukrainian war, to shrink to less than 1% after the war raised the uncertainty in the markets and changed the decisions of central banks.

The US Federal Reserve must now balance achieving good growth levels while overcoming the problem of inflation by raising inflation rates, which will be the most difficult equation after the rise in metal, food and all energy products prices to record levels.

Market movements will be based entirely on Bank President Jerome Powell’s statements and his future view of interest rates and the extent to which the Fed is willing to go to stop rising inflation rates, in addition to interest expectations or the Diet Pilot chart that will be issued every three months.

The latest US Federal Reserve forecasts that were issued indicated three increases in interest rates during the year, but now the markets are priced about 5-6 hikes during the year, and accordingly, the economic outlook report will be important in determining market movements.

The committee is also expected to raise its inflation forecasts and at the same time it will revise its growth forecasts for at least the first half of this year.

Bank of England

The Bank of England is expected to raise interest rates for the third time in a row at its meeting next Thursday, March 17th, by 25 basis points to reach 0.75%. Inflation in the United Kingdom reached its highest level in 30 years in January reading at 5.5%.

Pressure on living standards for families in the UK. So far, estimates indicate that interest rates may be at 1.75% by the end of this year, which means that we will witness four times an increase in interest rates after Thursday’s meeting to reduce the risks of high inflation.

Bank of Japan

On the other hand, the Bank of Japan is not expected to change its monetary policy at its meeting next Friday by the end of the week and to keep the current negative interest rates.

Bank of America expects the Bank of Japan to end the policy of negative interest rates at its meeting in October and to move the target 10-year yield ceiling from 0.25% to 0.50%, which if the bank hints at it will support the gains of the Japanese yen.

We will follow up on different data during the week

Tomorrow, Tuesday, we will follow the minutes of the meeting of the Reserve Bank of Australia for its meeting two weeks ago, in addition to data (industrial production – retail sales – fixed asset investments – unemployment rates) from China in the Asian session, labor market data from the United Kingdom and the German ZEW index will be announced in the European session, in The American session We will monitor the Producer Price Index (PPI) in addition to the Empire State Manufacturing Index.

Wednesday, Canadian inflation data will be released in the American session, in addition to the US retail sales index. At the end of the American session, a quarter of an hour before closing.

Thursday in the Asian session, Australian labor market data (change in employment and unemployment rates) will be announced, while attention will turn to the Bank of England meeting in the European session, weekly unemployment benefits, Philadelphia manufacturing index and home sales, the most important events of the American session. Friday is the last session of the week.

We will watch the Bank of Japan’s meeting in the Asian session. On the other hand, Canada will announce the retail sales in the American session.