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European Central Bank could trigger huge rate hike as economy slides into recession

The European Central Bank is expected to anticipate a series of rate hikes and sacrifice growth in the region as the rising cost of living threatens to soar even higher.

Speech by Isabel Schnabel, Member of the Executive Board of the ECB, in Jackson Hole set the tone for the next policy meeting this week. With inflation in the Eurozone expected to reach at least 10% in the coming months and the risk of a spike in consumer prices, a “jumbo” rate hike of 75 basis points on Thursday is certainly a possibility.

“As early hikes can have a bigger impact on inflation expectations than a more gradual approach, a move of 75 basis points could make sense,” said Holger Schmieding, ECB watchdog and chief economist. de Berenberg, in a research note.

Read the whole story here: European Central Bank could trigger huge rate hike as economy slides into recession

—Holly Ellyatt

US dollar has legs to go even higher, says Wells Fargo strategist

According to Wells Fargo Securities FX strategist Brendan McKenna, the US dollar still has room to climb even higher thanks to rate differentials on the back of a hawkish Federal Reserve.

“We think a lot of these international banks won’t be able to raise rates as aggressively as the markets expect,” he told CNBC’s “Squawk Box Asia.”

“So it’s sort of a combination of a more hawkish Fed and a less hawkish tightening cycle from those international central banks that are supporting the dollar for the rest of this year,” he said. declared.

– Jihye Lee

Goldman Sachs raises forecast for Fed hike this year

Goldman Sachs has revised its forecast for the next year of Federal Reserve rate decisions.

Analysts led by chief economist Jan Hatzius said in a note that the company expects a 75 basis point hike in September, compared to a previous forecast of 50 basis points, as well as an increase of 50 basis points in November, also revised. compared to a previous projection of 25 basis points.

He also expects a 25 basis point hike in December – citing officials’ recent hawkish comment.

The note said Fed officials “appeared to imply that progress toward inflation control has not been as uniform or as rapid as they would like,” the note said.

– Jihye Lee

CNBC Pro: Wall Street pro predicts when the S&P 500 will rally – and reveals how to trade it

Market volatility is here to stay, according to market veteran Phil Blancato.

But the chairman and chief executive of Ladenburg Thalmann Asset Management sees a “strong rally” on the cards as market conditions improve.

It predicts when the rally will take place and names its top picks for trading volatility.

Pro subscribers can learn more here.

— Zavier Ong

All major averages close higher, Nasdaq sets off 7-day losing streak

Stocks rallied on Wednesday as Wall Street shrugged off concerns about aggressive rate hikes from the Federal Reserve.

The Dow Jones Industrial Average gained 435.98 points, or 1.40%, to end the day at 31,581.28. The S&P 500 rose 1.83% to 3,979.90 and the Nasdaq Composite rose 2.14% to 11,791.90, breaking a seven-day losing streak.

—Carmen Reinicke

European markets: here are the opening calls

According to IG data.

The data releases include preliminary eurozone unemployment data for the second quarter as well as gross domestic product for the second quarter. The latest UK inflation figures for July will be released along with the preliminary Dutch Q2 GDP.

Revenue comes from Uniper, Carlsberg, Persimmon, Balfour Beatty, BAT and National Grid.