September 29, 2022
United States:
The Unstoppable Dollar Is Wreaking Havoc Everywhere But America
The mighty dollar is steamrolling everything right now, causing issues for economies almost everywhere—except in the US. That means that, for now at least, it’s not America’s problem and the historic central-bank-fueled surge in the greenback is unlikely to abate anytime soon.
By some measures, the US currency is already stronger than ever, eclipsing the highs of the Covid-19 pandemic from early 2020. The pain it’s inflicting has echoes of the mid-1980s, when foreign exchange chaos forced the world’s most important finance officials to join hands and impose a solution on markets. Right now, though, it’s every country for itself as the US administration pushes back on the idea of coordinated market action.
Europe:
Next Euro-Zone Hike in Focus as ‘Big’ Move Backed: ECB Update
The European Central Bank should opt for a “big” increase in interest rates in October, according to Governing Council member Martins Kazaks, who said in an interview that subsequent hikes are likely to be smaller.
His Baltic counterparts Gediminas Simkus and Madis Muller also indicated they’d back significant moves, while Mario Centeno of Portugal called for a “measured and balanced” approach and Spain’s Pablo Hernandez de Cos revealed an estimate for the terminal rate.
Asia:
India Heads for Its Third Half-Point Hike as Rupee Slumps
India’s central bank is expected to increase its policy rate by half a point for the third time in a row as the currency’s plunge to a record low this month complicates the battle against inflation.
The Reserve Bank of India’s six-member monetary policy committee will raise its repurchase rate by 50 basis points to 5.9%, according to 34 of 46 economists surveyed by Bloomberg as of Thursday. Eleven forecast the rate will rise by 35 basis points to 5.75%, while one sees a quarter-point increase.
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