The super interest rate week ended last week. The actions of the three major central banks of the U.S. Federal Reserve, the European Central Bank and the Bank of England did not exceed market expectations, and the rate hike rate was lowered from 0.75% last time to 0.5%. Monetary policy has begun to loosen slightly . However, the major central banks’ post-meeting statements unanimously indicated to the market that the cycle of interest rate hikes is not yet over: US Federal Reserve Chairman Powell said that the tightening monetary policy may be maintained for a period of time, while the interest rate dot plot shows that the committee members expect the median rate peak The number will reach 5.1%, and there is no chance to start cutting interest rates until 2024; European Central Bank President Lagarde pointed out that it is expected to continue to raise interest rates at a rate of 0.5%, and there is no plan to change monetary policy for the time being; and The Bank of England also expects that inflationary pressures will last longer than expected, and may require further rate hikes to suppress. The attitude of doves and hawks not only reduces the market’s expectation of slowing down the rate hike, but also rekindles the market’s worries that the economy will fall into recession.
Temporarily see greater resistance at $85
The interest rate hike cycle may be longer than expected, which means that the pressure on the economy caused by tightening policies will continue, and may even cause an economic recession. In fact, internal analysts of the Federal Reserve Board predict that the U.S. economy will have a 50% chance of recession, and the International Monetary Fund and the World Bank have even warned that aggressive interest rate hikes by global central banks will curb economic growth. body will face decline. In the face of a highly uncertain environment, the crude oil market is also bearing the brunt. Although the Organization of the Petroleum Exporting Countries and its allies announced that they will maintain the production cut of 2 million barrels per day unchanged; in addition, the European Union has set a price ceiling for oil imports from Russia, which may eventually make Russia Production has dropped by regarding 1 million barrels per day, and the supply level seems to have been greatly reduced or will be reduced. However, international oil prices continue to be weak. New York oil futures even fell below the important mark of 76 US dollars, reaching as low as 70 US dollars at one point, a new one-year low. It can be seen that regardless of the good news on the supply side, the worries regarding economic recession are still lingering, and the negative news of demand contraction will dominate the trend of international oil prices, making oil prices easy to fall but difficult to rise. It is believed that New York oil futures will see a relatively large resistance at US$85 for the time being, and it is not ruled out that it will test the US$65 mark in the future market. Only when recession worries cool down can oil prices truly stop falling and recover.
Global Market and Forex Strategist, Everbright Securities International
Huang Junneng
