MILANO – The concern that, in order to cope with increasingly “hot” prices, central banks will have to tighten their policies even more worries the financial markets. The Austrian governor Robert Holzmann, a member of the ECB board, according to the Bloomberg argues that it may be necessary to accept a “moderate” recession to curb price pressure, if inflation signals are still on the upside. “Hopefully that’s not necessary,” he told the Orf network on Sunday evening.
The same reasoning that is being done within the Fed, where even the tightening is already at a more advanced degree. The US central bank will announce its next move on Wednesday, again with the aim of keeping inflation under control. And here too the expectation is that it is necessary to inflict some more punishment on the economic trend to bring prices back into the ranks: the expectation is for another 75 basis point squeeze, but it is hoped that President Powell will give some indication on the next steps. More and more analysts believe it is inevitable to drive the economy into recession, or at least to a condition of higher unemployment, to deflate prices that have been at the highest for forty years.
Among these speeches, the reopening of the markets looks weak as it has already been in Asia, where the main squares have moved in the red. Futures on European exchanges are mixed, while those on Wall Street are slightly down.
Euro slightly down
The euro opens slightly against the dollar at the start of the week. The meeting of the Fed’s monetary policy committee is scheduled for Wednesday in which a new rise in interest rates is expected. After the parity has been touched in recent days, the exchange rate between the European currency and the greenback is currently at 1.0197. The euro, on the other hand, gains against the Japanese yen, the price is at 139.10, and against the British pound, changed to 0.8521.
Asian exchanges in red towards the close
The Asian stock exchanges travel in the red: in Tokyo the Nikkei loses -0.81% and is moving towards closing, in Hong Kong the Hang Seng -0.95%. Also bad was Sahanghai with -0.61% and Shenzen’s Szse composite index with -0.62%. The only exception was the Seoul Kospi index which gained 0.58%.
Futures on the EU stock exchanges contrasted, weak Wall Street.
European stock market futures mixed with a downward trend, after a mixed weekend on the lists following the decision of the ECB to raise interest rates by 50 basis points after 11 years. At the moment the contracts on the Mib bi Milano are losing 0.22%, Paris is worse with the Cac 40 at -0.51%. Futures on the Dax in Frankfurt and on the FTSE 100 in London are flat, marking -0.06%.
Futures in live fall on Wall Street at the start of the week in which a new increase in interest rates is expected from the Fed. At the moment the contracts on the Dow Jones mark -0.15%, those on S&P -0.15%, those on the Nasdaq -0.10%.