invasion and what that is going to have of the american economy and around the world. and for mr powell and his colleagues at the federal reserve, so for the indication is that it reserve, so for the indication is thatitis reserve, so for the indication is that it is a wait and see kind of moment, when looking at the fundamentals in the us, thejob market is looking strong and inflation is far past that 2% target rate, so they want to increase interest rates and they believe now is the time to increase. but they will be looking very closely at what happens with ukraine because as you pointed out at the beginning, the high cost of energy is surely going to start increasing and having an even bigger impact on inflation, which right now in the us is at a 40 year high. which right now in the us is at a 40 ear hiih. ., , . which right now in the us is at a 40 earhiih. ., , . , year high. you very much. let s look at the markets. in london they have suspended a further 27 companies with li
for that, let s bring in cnbc s rosanna lockwood. a volatile session on wall street yesterday, stocks are mixed, with a federal reserve meeting today. what s your sense? any signs of relief on the horizon? not much, to be honest. the federal reserve, it could be the main conduit for providing that relief to the market. widely expected at the end of the two day meeting to change the target rate in response to run away inflation stateside. when i say not much hope, obviously there is a lot hinging on these ukraine peace talks happening later on today, but expectations for those are somewhat muted. what is also clouding market sentiment today in a very big way is china, and i m sure we will come back to that but the covid risk in china, what we re seeing playing out in hong kong,
and natural gas prices at elevated levels, soft commodities such as wheat and copper and aluminum and nickel, all at record levels or there-abouts and that is potentially going to lead to higher inflation late in the year and crimp on oil prices, and higher oil prices are often referred to as a tax on growth. this isn t just a u.k. situation, it is worth pointing out yesterday, the united states, we learned that inflation last month came in at 7.9%, that is the highest level in four decades, and in the euro zone, inflation is running at 5.4%. more than double the european central bank s target rate. and indeed bcb hinting yesterday that they may be forced to raise interest rates sooner than expected this year, all to the backdrop of the war in ukraine which does as i say threaten to destabilize growth. this is all playing out on global stock markets right now. europe sounded off yesterday
the green. point number two, they are you ll tougher than you might have thought going in. so now six rate likes, all subject to change. now projecting six rate hikes to get to 1.9% by the end of the year. prior to that, i think fed was 3 to 4 rate hikes and then four more next year, so ten rate hikes, blah blah blah blah. the trouble with this story is the inflation rate is moving towards 10%. in fact, your import prices were up 11% for the 12-month change. so, they are going to have to take that target rate to 6, 7, 8, 9% before this is over. not 1, 2, 3, or 4. this, we are already in a stagflation more, g.d.p. very
we so woo have had a half point so we would have had a half point rise last month. but the vast majority of economists here expect a rate rise this lunchtime. why? inflation is running at nearly three times the bank s target rank of 2%. currently it is 5.5%. that was a february, a january figure and we get the february figure next wednesday. that of course, as we say, way above what the bank s target rate is at 2%. currently running at the highest level since march, 1992. and it s a tricky decision for the bank because obviously the war in ukraine has let the commodity price fight across the area, oil, metals, wheat, you name it, so after that, concerns over what the war will do to growth, it means that it is quite a finer decision for the bank of england, than probably many people expected. worth pointing out as well, kate, this is a global situation. inflation in the united states currently running at some 7.9%, which is the highest for four