The Federal Reserve finally lifted rates this week, but it was accompanied by unchanged forecasts, making it a ‘dovish hike’ which led to higher stocks and commodities and a drop in the dollar. A number of Fed speakers in the week starting March 20th could set the tone for whether this market reaction continues or reverses.
Also on tap, UK retail sales and inflation data will make for interesting viewing following the dissent of MPC policymaker Kristen Forbes at last week’s Bank of England meeting. If inflation continues to rise as expected, it adds credence to her hawkish stance. We are also expecting an official response from the UK government to a second Scottish referendum.