While global markets followed a negative course with increasing expectations that the US Federal Reserve (Fed) would keep interest rates higher for a longer period of time, investors focused on the Fed's interest rate decision, policy statement and Fed Chairman Jerome Powell's speech after the decision.

In the money markets, although it is certain that the Fed will leave the interest rate unchanged at the monetary policy committee meeting to be held today, uncertainty about the path it will follow for the rest of the year continues.

Analysts said that signals about how the Bank will take steps in the coming period will be sought in the policy text and Powell's statements after the meeting.

Stating that concerns that the Fed will keep interest rates higher for a longer period of time have increased, analysts pointed out that 10-year US Treasury bond yields are at their highest level since November 2007.
Analysts emphasized that oil prices, which are hovering around 10-month highs amid supply concerns, could further complicate global central banks' fight against inflation.

Stating that rising oil prices both increase inflation and put pressure on economic growth, analysts reminded that this situation played a major role in the US going into recession in the mid-1970s.

On the other hand, yesterday, the Organization for Economic Cooperation and Development (OECD) revised its growth forecast for the global economy, which was announced as 2.7 percent for 2023 in June, to 3 percent, while the growth forecast for 2024 was reduced from 2.9 percent to 2.7 percent.

In the OECD report, "The global economy remained more resilient than expected in the first half of 2023. However, the growth outlook remains weak. With monetary policy becoming increasingly visible and a weaker-than-expected recovery from the Chinese economy, global growth in 2024 is projected to be lower than in 2023."
In addition, shares of General Motors, Ford and Stellantis increased by about 2 percent each, following the news flow that US carmaker Ford reached an agreement with the organized labor union at its Canadian plant.

The United Auto Workers Union (UAW), which went on strike in the US, announced that more factories would go on strike if there was no serious progress in ongoing talks with automotive manufacturers.

It was also noteworthy that Walt Disney shares lost nearly 4 percent after the company announced that it would almost double its capital expenditures for the park business in the next 10 years.

On the New York stock exchange yesterday, the S&P 500 index lost 0.24 percent, the Nasdaq index lost 0.23 percent and the Dow Jones index lost 0.31 percent. Index futures contracts in the US started the new day with a negative course.

European stock markets

While a positive course dominated the European stock markets yesterday before the Fed interest rate decision, today's intense data agenda was also in the focus of investors.

Analysts emphasized the importance of inflation data to be announced today in the country before tomorrow's Bank of England (BoE) interest rate decision. The Consumer Price Index (CPI) in the UK is expected to increase by 0.7 percent on a monthly basis and 7 percent on an annual basis in August.

In money markets, the probability of the BoE raising the policy rate by 25 basis points at the monetary policy meeting tomorrow is priced at 80 percent.

While the verbal guidance of the European Central Bank (ECB) officials on future policies were also in the focus of investors, Bank of France Governor Francois Villeroy de Galhau stated that the ECB will maintain interest rates at these levels for a long enough period of time.

Stating that inflation is a disease and interest rates are a medicine, Francois Villeroy de Galhau said, "When inflation comes towards 2 percent, the ECB can lower interest rates."

Yesterday, the FTSE 100 index in the UK gained 0.09 percent, the CAC 40 index in France 0.08 percent and the MIB 30 index in Italy 0.60 percent, while the DAX 40 index in Germany decreased by 0.40 percent. Index futures contracts in Europe started the new day with a negative course.