 The FOMC meeting turned out to me more hawkish than expected and markets are now pricing in four to five hikes this year, instead of three. Dollar was given a strong boost and surged broadly to end as the strongest one. Nevertheless, reactions in the stock markets, while wild, were not pessimistic. Sterling followed as the second strongest, as inflation outlook is going to push BoE for a hike again this week. Australian Dollar was the worst performing one as RBA is clearly lagging behind Fed on tightening, followed by New Zealand Dollar. Both were also weighed down by risk aversion in Asia, in particular in China and Hong Kong markets. Euro and Swiss Franc were mixed together with Canadian, but the latter was support by persistent strength in oil price. |
