Weekly Market Outlook | 16.06.2017

Fed continues to raise rates

It was a busy week for global central banks. Fed finally delivered and raised rates for the second time this year despite lacklustre economic data. The Bank of Japan opted to maintain current monetary policy strategy as the country is still suffering from its safe haven status and struggles to boost inflation. Japanese central bankers nonetheless expect foreign demand to increase within the medium-term. Markets have clearly shifted their attention back towards central banks’ policy and geopolitical issues. What once drove markets volatility, Trump presidency is now seen as distraction to be quickly faded by traders. In a sudden shift markets are now preparing for central banks to move towards tightening. Finally, the Reserve Bank of New Zealand may surprise markets next week as economic, while slowing, remains solid.