Rate rises for USA / UK but by how much?

As can be seen the economic data is second rate and rare this week, however the week will not be without its opportunity for action since the USA, British and Japanese all have rate decisions to make.

Bar, controversially, the LME the UK will be pretty much closed for Queen Elizabeth’s state funeral on Monday so this maybe an opportunity for the remaining market to test the recent lows in GBPUSD. GBP and the Yen are the weakest of the majors with economic (and to some degree political ) worries and both have rate decisions to make. Expectations are that the Bank of Japan do nothing – although they are expressing unhappiness with the level of USDYEN indeed on Wednesday they rate-checked prices, the Bank of England is expected to raise 50bps and is not mandated to worry about FX levels but the drop in GBP is adding to the inflation fire as mainly products are priced in USD.

The Fed are expected to go 75bps in fact some commentators believe that 100bps is not impossible but they will have seen the dreadful Q1 figures from FEDEX and be aware that the US economy is starting to weaken so 75bps feels the most likely.

Even the European Deputy Governor said that that a weakening economic outlook is not going to curb inflation…

Commodities have seen some weakness on the back of potential global slowdown and China still placing restrictions on its citizens over Covid and its “zero policy”. But it does depend on supply for example fears of restrictions in aluminium production leave that market higher but the gas markets are lower.

OPEC+ seem to like an oil market between $85-105 so sustained movements outside of that range will be watched with interest as to OPEC+ response.






Sep 20


Inflation Rate





Housing Starts



Sep 21


FOMC Rate decision



Sep 22


Bank of England rate decision





Initial Jobless Claims



DISCLAIMER – Do not rely on information contained in this Market Commentary.

The content of this Market Commentary is provided for general information only. It is not intended to amount to advice on which you should rely. In particular, neither this Market Commentary nor any other content of our website should be construed as investment advice. The information contained in this Market Commentary is not, and should not be read as, an offer, recommendation or inducement to engage in investment activity. In no event shall we be liable for any damages resulting from reliance on or use of any information contained in this Market Commentary. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content of this Market Commentary. 

Although we make reasonable efforts to ensure that that the information in this Market Commentary is accurate as at the date on which it is published, we make no representations, warranties or guarantees, whether express or implied, that it is accurate, complete or up to date.