Anxious markets await the Fed decision on Wednesday. The weekly highlight falls on Jerome Powell as he heads for his first interest rate increase as Federal Reserve Chairman this week. The most important question investors are looking for some clues is whether the optimism about the U.S. economy could lead to more hikes than markets have prepared for.
This week is full of important meetings that could have a potential geopolitical effect. The spotlight would be on the two-day G20 summit in Buenos Aires that starts on Monday. Any signs of escalating stress between the U.S. and China could make investors nervous. U.S. Treasury Secretary Steven Mnuchin will be in a position of defending Trump’s trade plans against widespread criticism from G20 partners. Among others, the crypto-currencies use and regulation is also on the agenda of the Group of 20 finance ministers.
In Asia, equity markets traded mixed on Monday as investors are cautious this week in which the Federal Reserve is likely to hike U.S. interest rates and perhaps signal that as many as three more for the rest of the year. Investors are looking closely for any remarks from Fed Chair Jerome Powell as this will be his first press conference.
On Thursday, which is also called Super Thursday, the Bank of England interest rate decision will be reported at 12:00 GMT and Governor Mark Carney will hold a press conference shortly after the announcement. No change is expected, though the BoE could point to a possibility of an interest rate hike in May. Brexit developments will also be in focus, as a two-day European Council summit begins on Thursday, with negotiators trying to reach agreement on the transition period after the UK’s departure from the EU.