What critical financial events await us in the week of December 2016, 2022? Wednesday and Thursday will be the busiest. We expect decisions on the level of rate hikes from four major global institutions. What should SimpleFX traders keep an eye on next week?
Table of contents:
Important Financial Events 12-16 December 2022
1. FOMC Press Conference (Wednesday, December 14)
The Federal Open Market Committee (FOMC) will hold a press conference on Wednesday, December 14th, to announce its latest economic policy decisions. This event is significant to financial markets. The FOMC’s decisions on monetary policy, such as setting interest rates, can significantly impact global markets.
The FOMC meeting is expected to focus on the future of the U.S. economy and the central bank’s plans for monetary policy. The committee is expected to announce its decisions on interest rates and any other changes to the U.S. monetary policy. The decisions could be viewed as either hawkish or dovish, depending on the actions taken.
2. Fed Interest Rate Decision (Wednesday, December 14)
The Federal Reserve is set to issue its interest rate decision on Wednesday, too, and the markets eagerly await the outcome. The decision is expected to significantly impact the U.S. and global economies. The Federal Reserve has kept its benchmark interest rate near zero since the beginning of the coronavirus pandemic. The central bank has used low-interest rates to support economic growth and keep inflation at bay.
Analysts expect the Federal Reserve to maintain its current interest rate policy. This would signify that the Fed believes the economy is fragile and needs additional stimulus. Low-interest rates can help stimulate economic growth by encouraging borrowing, which leads to more consumer spending and business investment. At the same time, keeping interest rates low for too long can lead to inflation and weaken the U.S. dollar.
3. SNB Interest Rate Decision (Thursday, December 15)
The Swiss National Bank (SNB) is set to announce its interest rate decision on Thursday, December 15th. Investors and traders will closely watch the announcement as it could significantly impact the USDCHF forex pair and the Forex market. The SNB’s monetary policy is closely linked to the Euro, and the Euro–Swiss Franc exchange rate is a crucial gauge of the Swiss economy.
The SNB is expected to keep its interest rate unchanged at the current level of -0.75%, as it has done since the last rate decision in September. The decision is unlikely to surprise the markets, with the Swiss economy continuing to struggle with the coronavirus pandemic.
It will be an important event for the Forex market and could significantly impact the value of the Swiss Franc. Traders and investors should pay close attention to the announcement and prepare to adjust their positions accordingly.
4. U.K.’s BoE Interest Rate Decision (Thursday, December 15)
Also, the Monetary Policy Committee (MPC) of the Bank of England (BoE) will announce its interest rate decision on the same day. The decision follows the recent announcement of the Bank of England’s latest quarterly inflation report. The document showed that inflation remains below the target of 2%.
The MPC is expected to keep the current interest rate at 0.75% and credit costs at record-low levels. The economic outlook remains uncertain due to ongoing trade negotiations between the U.K. and the European Union.
The decision of the Bank of England on interest rates is essential for the Forex market and will affect forex pairs such as GBPUSD and EURGBP. The pound may strengthen or weaken depending on the decision, which may affect other currency markets.
5. ECB Interest Rate Decision (Thursday, December 15)
On Thursday, December 15, we will also get information on interest rates from the European Central Bank. Many anticipate the European Central Bank (ECB) will continue its aggressive interest rate hikes on Thursday to combat persistent inflation.
The U.S. has already implemented a round of rate hikes, and the ECB’s decision could drastically affect global asset prices. Since July, the ECB has raised the deposit rate to 1.5 percent from the historical low, totaling 200 basis points. This includes two meetings where the ECB raised rates by 75 basis points each.