The Bank of England has suspended bond sales and has started buying them. NAB’s David de Garis explains why the sudden about turn. Is the crisis over for the UK?
Bond yields continue to rise globally, with NAB’s Skye Masters saying the Fed and other central banks are working hard to convince markets that interest rates will stay higher for longer. Meanwhile the Bank of England promises a significant response to the unease of the last few days, but not till November.
Bond yields in the US continued to rise one day on from the Fed. We’re close to 2011 highs says NAB’s Ken Crompton. In the UK where the BoE lifted rates by 50bp whilst Japan’s Ministry of Finance was forced to step to defend the Yen after the BoJ again did nothing.
The Fed hiked by 75bp as expected. NAB’s Gavin Friend says markets responded more to the dot plots which have been revised markedly since June, suggesting higher rates for longer. Plus, Putin’s bluff, and the BoE later.
The Fed will push rates higher tomorrow by 75 basis points at least. Riksbank surprised with a 100bp rise but, as NAB’s Taylor Nugent points out, they are earlier in the tightening path. Meanwhile, is the war in Ukraine about to get worse?
Prepare for a week or uncertainty. NAB’s Ray Attrill says, after the carnage last week the mix of central bank decisions and thinner liquidity with so many public holidays, means we could be in for a wild ride against this week.