Yesterday, 7.6.2022, the World Bank indicated in its Global Economic Prospects report the possibility of global stagflation and lowered its global growth forecast for 2022 from 2.9% to 1.2% as a result of the Russian-Ukrainian war, and the multiple damages that followed the Covid-19 pandemic, and the economy may enter the world a prolonged period of inflation and a slowdown in growth.
The World Bank report also indicated that the economy in Europe and Asia is likely to contract by 2.9% during 2022, and growth in the economies of developed countries has slowed to 2.6% in 2022 and 2.2% in the next year 2023, after reaching 5.1% in 2021.
On the economic calendar, the markets are awaiting tomorrow, Thursday, 9.6.2022 at 12:30 GMT, for the European Central Bank to announce its monetary policy, in light of the recommendations to the European Central Bank to raise interest rates, as economic data from France and Germany indicated to Rising CPI, coupled with a sharp rise in the European region, this is enough to start the European Central Bank to raise interest rates.
However, it is unlikely that interest rates will be raised at tomorrow’s meeting and the possibility of signaling an end to asset purchases. It is possible that the European Central Bank will start raising interest rates at the next meeting in July, the central bank is expected to indicate tomorrow to raise interest rates by 25 points in July. In the event that a 50-point hike is indicated, we may witness a sharp rise in the single currency (the euro) against all currencies.
Also, on Thursday of this week, 9.6.2022, the US inflation figures will be of interest to many investors and traders, with expectations that the US inflation figures will continue to rise, which will increase the Fed’s tightening on raising interest rates.