A Turbulent Lies Week Ahead

2022.09.20 08:34

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It’s been quite a volatile start to the week, which is unlikely to abate considering what’s to come over the next few days.

Central banks are lining up this week to deliver huge rate hikes as the desperate fight against inflation continues. The on Wednesday, but others will follow, including the , , , and the on Thursday.

The BoJ will also on Thursday, but the topic of conversation there will likely be how to generate sustainable , not fight it, and the spiraling . The CBRT will ponder how much to cut rates again despite topping 80%.

PBOC Between A Rock And A Hard Place

Benchmark lending rates in China were left unchanged overnight as the central bank continued the balancing act of supporting the economy and a falling currency. The one-year was left unchanged at 3.65%, while the five-year was also unchanged at 4.3%.

This didn’t come as a surprise after the MLF was also unchanged last week. The PBOC is truly between a rock and a hard place at the moment, made all the worse by lockdown uncertainty amid various COVID outbreaks and an ongoing zero-tolerance approach.

Will Bitcoin Break The June Low?

Another turbulent session for at the start of the week as the crypto came close to its June low before recovering alongside other risk assets.

While that may be a relief in the short term, it may also generate some nerves as a break of that low could see it spiral lower once more. It’s not a great environment for risk assets, and central banks could deliver another blow this week. ​

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