BlackRock says markets underestimate inflation’s persistence, Fed hike and hold rates high

BlackRock preview what they expect from the Federal Open Market Committee (FOMC) on Wednesday, 26 July 2023 and further ahead:

• "Central banks are set to hike policy rates this week. Markets expect rate cuts to soon follow due to cooling inflation, whereas we see central banks holding tight"
• “The Fed and European Central Bank will likely raise interest rates again this week. We see the Bank of Japan opting to keep policy loose to sustain inflation.”
• "We favor U.S. inflation-linked bonds as markets underestimate inflation’s persistence."

Earlier:

• TD expect lower USD after the Federal Open Market Committee (FOMC) meeting today, preview
• Forexlive Americas FX news wrap 25 Jul: The USD was lower ahead of Fed decision tomorrow

FOMC announcement due at 2pm US Eastern time, Federal Reserve Chair Powell follows a half hour later