US and Brazilian central banks to release interest rate decisions today (Images: Agência Senado – Marcos Oliveira/REUTERS – File Photo)
The most anticipated day of the week has arrived: Super Wednesday. Today (18), the Central Banks of USA (USA) and the Brazil disclose the decisions for their respective rates of fees.
O Federal Open Market Committee (Fomc), do Federal Reserve (Fed), is the first to announce his decision, at 3:00 p.m. (Brasília time). Then, at 3:30 p.m., the president Jerome Powell holds a press conference to detail the verdict.
The expectation is that the FOMC will begin the monetary easing cycle. Although Powell has given the guidance that an adjustment would occur at this meeting, the market remains divided on the size of the cut. The day before, the majority (63%) expected a reduction of 0.50 percentage points (pp), but another portion (37%) bet on 0.25 pp, according to the CME FedWatch Tool.
According to the BTG Pactualone of the main reasons for the indecision is the weaker labor market in recent readings, which has raised the alarm about the possibility of a more intense economic slowdown. “We expect them to emphasize the Committee's view of a more balanced balance of risks between employment and inflation“, they say.
In Brazil, where the decision is made after the markets close, a new tightening is expected. Copom options, contracts that allow the negotiation of rate variations, indicated that the Central Bank should increase the Selic by 0.25 pp (R$ 76.50), but there were still those who considered a more hawkish (up 0.50 pp – R$ 15) or even more dovish (maintenance – R$ 8.75).
BTG — which expects a more modest increase — highlights that Copom's communication since the last meeting has evolved significantly, as has the economy's performance.
Members already agreed that there were more upside risks to the balance of risks to inflation, and they had raised their tone in recent communications. On the data side, there were surprises in the GDPlabor market tightening, signs of acceleration of IPCA on the margins and persistently unanchored expectations.
Morning Times: Check out the markets this Super Wednesday morning
Asian stock markets
- Tokyo/Nikkei: 0.49%
- Hong Kong/Hang Seng: 1,37%
- China/Shanghai: 0.49%
European stock exchanges (open market)
- Londres/FTSE100: -0,50%
- Paris/CAC 40: -0,26%
- Frankfurt/DAX: -0,04%
Wall Street (futures market)
- S&P 500: +0,11%
- Dow Jones: +0,16%
- Nasdaq: +0,12%
Commodities
- Oil/WTI: -1.66%, at US$ 70.01 per barrel
- Oil/Brent: -1.51%, at US$ 72.59 per barrel
Cryptocurrencies
- Bitcoin (BTC): +1,43%, a US$ 59.977,0
- Ethereum (ETH): -0,40%, a US$ 2.305,04
Happy Wednesday and keep an eye on Money Times for the latest market news!