Trading Plan – Monday 9th May 2022: Dovish rate hikes in US and UK

Mark NugentMay 2022, Trading Plan

Trading Plan – Monday 9th May 2022: Dovish rate hikes in US and UK

Good morning.

Last week was dominated by “dovish” rate hikes from the Fed and the Bank of England. In the US, Fed Chair Powell squashed the chances of a 75 basis-point rate hike in the future. Equities had a relief rally, but the next day all the gains were given back.

In the UK, Governor Bailey essentially said the economy cannot handle much more rate hiking, with the growth-suppressing nature of inflation, currently forecast to go to at least 10 percent, leading to a likely “prolonged period of stagnation”. Yuk. So, like a Fed, a “dovish” hike. The GBP sank like a stone.

This week is quiet on the calendar. We shall watch the dust settle from the central bank pronouncements.

As always, I go through my trading themes for the week in the video.

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