Overseas Headlines – April 22, 2022

United States:

Fed Rate Bets Turbocharged as Traders See Four Half-Point Hikes

“Traders bolstered bets on a more aggressive pace of rate increases from the Federal Reserve and the European Central Bank as policy makers seek to curb inflation at its fastest pace in at least several decades. Money markets priced in 200 basis points of tightening by the Fed’s September decision, according to interest-rate swaps. That implies a half-point hike — unheard of since 2000 — in May, June, July and September to take the upper bound of the federal funds rate’s target range to 2.50%.”



Germany Faces Recession If Ukraine War Leads to Energy Ban

“The German economy is at risk of shrinking nearly 2% this year if the war in Ukraine escalates and an embargo on Russian coal, oil and gas leads to restrictions on power providers and industry, according to the Bundesbank.”



Japan Finance Minister, Yellen Confirm Existing Forex Agreements as Yen Plunges

“Japan’s Finance Minister Shunichi Suzuki and U.S. Treasury Secretary Janet Yellen met Thursday and agreed to uphold existing foreign exchange-rate agreements, with Suzuki saying he discussed recent abrupt moves in the yen. Suzuki declined to comment on whether the two spoke about market intervention to prop up the yen. He said the talks focused more on the state of their economies than on concerns over currencies.”




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