Week's main events (April 18 – April 22)

Last week, investors focused mainly on the US Consumer Price Index. Сonsumer inflation in the US rose to 8.5% year on year, the highest level since 1981. Investors now expect the Fed to be more aggressive with monetary policy. The probability of a 0.5% interest rate hike increased to 80% at the Fed meetings in May and June. Meanwhile, some Fed officials are already calling for a balance sheet reduction after the May meeting. Investors should focus on inflation data in Canada and New Zealand this week. Rising inflation is always a reason for the central bank to tighten monetary policy, so high inflation is often accompanied by rising national currency. Fed Chairman Jerome Powell will address the International Monetary Fund on Thursday. He will participate in a panel discussion on the global economy with European Central Bank President Christine Lagarde and other central bank policymakers. Several Dow Jones blue chips are due to report within the next week. Traders should also monitor the oil market. The ongoing war in Ukraine is already forcing European countries to think about a complete oil embargo on Russian energy resources, which will undoubtedly slow down the region’s economy and cause recessionary sentiment.