Bloomberg: Policy of central banks turned out to be more aggressive than the market forecast

Source: Bloomberg

Author: Sujata Rao and Tassia Sipahutar

Article: Original Article

Publication date: Monday, December 18, 2022 

Last week, euphoria sparked by softer-than-expected US inflation data last week, decreased as the central banks made it clear that they have no intention to suspend the cycle of policy tightening. 

Fed officials said that the interest rates will grow till they are assured that inflation is suppressed. The central banks from all over the world including the European Central Bank published hawkish forecasts to confirm their words. 

“Many factors indicate high inflation in the future, and this means that central banks, especially the Fed, will continue the aggressive policy and maybe more than the market expects,” said the leading strategist in Saxo Bank Charu Chanana to Bloomberg Television.

Meanwhile, Morgan Stanley analysts warned that the upcoming recession of incomes may be like the 2008/2009 downturn, and in 2023 “the fall in prices for stocks will be worse than investors’ expectations.“

Forecast: decrease of NASDAQ