The recession risks | 10 Junio 2022

10 Junio 2022, USD/JPY

The recession risks

USDJPY trading plan:

The U.S. Federal Reserve will hike its key interest rate by 50 basis points in June and July, with rising chances of a similar move in September, according to poll of economists who see no pause in rate rises until next year. Faced with inflation running at just below a four-decade high and more tightening in the labor market, the Fed is under pressure to quickly take its policy rate to the neutral level that neither stimulates nor restricts - and beyond. While more than two-thirds of respondents, 59 of 85, expected a 25-basis point hike in September, more than one-quarter, 23, saw the Fed hiking again by half a point. That is up from one-fifth of the sample last month. Rate hike expectations knocked the U.S. stock market briefly into bear territory last month and the U.S. 10-year Treasury yield to trade above 3% for the first time in three years. They have also kept alive recession risks.

Investment idea: buy 133.55 and take profit 134.00.

David Johnson
Analyst of «FreshForex» company
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