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23-10-2022, 07:53 AM
The Bank of England has had to flip back to quantitative easing and buy gilts, delaying its planned tightening actions amid the fiasco sparked by UK prime minister Liz Truss' failed tax cut plans.
Meanwhile the Bank of Japan has been forced to buy bonds this week as the Yen plunges to 32-year lows relative to the US dollar. Additionally, the European central bank is "considering but not yet committing to even passive quantitative tightening," Hartnett said.
A signal investors can monitor that would suggest the Fed is leaning towards a pause would be halt in the US dollar's march towards new highs, according to the note.
Any pivot from the Fed, whether it's in the form of a pause in further interest rate hikes, or a reduction or pause in its monthly balance sheet reductions, could be viewed positively by investors and lead to a sizable relief rally, but Hartnett still sees pain ahead before that happens, with the expectation that stocks will hit new lows soon.
https://markets.businessinsider.com/news...ng-2022-10
Meanwhile the Bank of Japan has been forced to buy bonds this week as the Yen plunges to 32-year lows relative to the US dollar. Additionally, the European central bank is "considering but not yet committing to even passive quantitative tightening," Hartnett said.
A signal investors can monitor that would suggest the Fed is leaning towards a pause would be halt in the US dollar's march towards new highs, according to the note.
Any pivot from the Fed, whether it's in the form of a pause in further interest rate hikes, or a reduction or pause in its monthly balance sheet reductions, could be viewed positively by investors and lead to a sizable relief rally, but Hartnett still sees pain ahead before that happens, with the expectation that stocks will hit new lows soon.
https://markets.businessinsider.com/news...ng-2022-10
