In the UK, money markets have generally maintained expectations for a cut in the Bank of England's interest rate, showing a steady decline of about a quarter of a percentage point this year by approximately 40% after inflation rose for the second consecutive month in July. The British pound rose by 0.1%.
Meanwhile, traders are preparing for Powell's statements, and Treasury bond markets consider a quarter-point rate cut next month virtually inevitable, pricing in at least one more cut by the end of the year.
Investors are waiting to see whether Powell will confirm current market expectations or refute them, emphasizing that new economic data arriving before the next monetary policy meeting could alter the forecast. They are also looking for insights into how the Fed predicts the pace of rate cuts next year.
"If we get confirmation that they are more inclined to cut interest rates, that will provide significant support again," said Gerald van der Linde, head of equity strategy for HSBC in the Asia-Pacific region, in an interview with Bloomberg TV.
What Bloomberg strategists are saying...
The sell-off of Nvidia shares ahead of its earnings report next week is a key factor for global investors in technology companies. Given that Nvidia shares have shown strong growth since April, this seems likely to be an obstacle to stock growth in the coming days.
— Mark Cranfield, MLIV
