Central Banks Rush to Raise Rates, Stronger Dollar’s Impact on Apple, Apple Music to Sponsor Super Bowl Halftime Show (Daily Update)
Hello everyone. Welcome to a new week.
Let's jump right in with a story that jumped out at me over the weekend.
Central Banks Rush to Raise Rates
Here’s the WSJ:
“Central banks around the world moved Thursday to combat the effects of a soaring dollar and rising inflation, joining the Federal Reserve in risking a recession to rein in climbing prices.
In a flurry of central-bank meetings from Norway to South Africa, many raised rates by larger-than-expected margins in a day that analysts at ING billed as ‘Super Thursday.’
The Bank of England raised its key interest rate for the seventh consecutive time on Thursday. Before the news came out, the British pound briefly touched its lowest point in 37 years against the dollar before recovering some of its losses to reach $1.13.
Even some countries that didn’t move rates—the Bank of Japan left its policy rate at its previous low level—took other action to ease the growing inflation pressure.
Japan said Thursday it intervened in currency markets to sell dollars and buy yen, the first such intervention in 24 years, to slow the recent fall in the Japanese currency. The yen fell to 145.87 to the dollar, its weakest level since 1998, before the intervention. It then surged to hit 141 yen, though still far off the 115 yen mark at which the dollar was trading earlier this year.”
More aggressive central banks would be a positive for Apple from the perspective of currency swings. Of course, if higher rates lead to slower economic growth around the world, Apple is exposed. However, Apple's competitors are more vulnerable to weaker sales due to slowing economic growth.
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