Bank of England and Swiss National Bank follow Fed in increasing interest rates

　　

On Wednesday, U.S. central bank officials raised interest rates to a new range of 3.0% to 3.25%. Policymakers also expect to lift rates higher than before and maintain that level, projecting the fed funds rate rising to 4.4% by the end of this year and 4.6% by the end of 2023. Numerous central banks from all over the world Thursday followed the Fed’s lead. The Bank of England increased its key rate by 50 basis points, and Switzerland’s National Bank hiked it by 75 basis points. Market observers also anticipate the European Central Bank to raise rates when it meets next month.

After the Federal Reserve’s most recent policy announcement and following comments from Chair Jerome Powell drove markets into chaos, U.S. stocks ended Thursday’s volatile day lower. The benchmark S&P 500 dropped by 0.9%, while the Dow Jones Industrial Average shed 100 points. The technology-heavy Nasdaq Composite fell 1.4%. The moves extend a Fed-induced sell-off Wednesday that saw the S&P 500 and Dow each erase around 1.7% and the Nasdaq plummet 1.8%, and mark a third straight day of declines for U.S. equity markets.

Boeing Co. agreed to pay $200 million to settle Securities and Exchange Commission allegations that the company and its former Chief Executive Officer Dennis Muilenburg failed to disclose safety issues with its 737 Max jetliner, resolving one of the final US investigations related to two crashes that killed 346 people.

The settlement, announced by the SEC on Thursday, concludes a probe into whether Boeing withheld key information from shareholders about a flawed software system linked to the 2018 and 2019 crashes. The SEC said the company and its former CEO violated securities laws by making “materially misleading” public statements. Without admitting or denying the findings, Boeing and Muilenburg agreed to pay $200 million and $1 million, respectively, to settle the allegations.

Main Pairs Movement

Following the US Federal Reserve meeting, several central banks made monetary policy announcements. The Bank of Japan decided to maintain its current monetary policy. . After reaching an intraday high of 145.89 during the meeting, the USD/JPY pair fell sharply to 140.34. It currently trades at around 142.40. The benchmark rate at Switzerland National Bank was increased by 75 basis points. However, USD/CHF advanced, ending the day in the 0.9780 price zone. The Bank of England, pulled the trigger by 50 bps.

The EUR/USD lacks conviction on Thursday, moving between small gains and losses, likely constrained by rising U.S. The EUR/USD pair trades around 0.9830, meeting intraday sellers at around 0.9900. The AUD/USD pair posted a modest intraday advance and hovers around 0.6640/50, while USD/CAD trades at 1.3480.

Spot gold posted a modest intraday gain and settled at $1,672 a troy ounce. Crude oil prices ended the day essentially steady, with WTI now changing hands at $83.50 a barrel.

Economic Data

Currency	Data	Time (GMT + 8)	Forecast
JPY	Japan- Public Holiday	All Day	–
EUR	German Manufacturing PMI (Sep)	15:30	–
GBP	Composite PMI	16:30	49
GBP	Manufacturing PMI	16:30	47.5
GBP	Services PMI	16:30	50
CAD	Core Retail Sales (Jul)	20:30	-1.2%