The pan-European Stoxx 600 rose 1.5% in afternoon trade, with all sectors trading in the green. Core funds were up 2.9%, while banks were up 2%. On Thursday, the European Central Bank announced a 75 basis point interest rate hike, taking its key deposit rate to 0.75%. The bank also revised down its inflation expectations – to an average of 8.1% in 2022 – and said it expected to raise rates further as “inflation remains very high and is likely to remain above target for an extended period”. . Meanwhile, the Fed’s Powell said on Thursday that the US central bank would raise interest rates to tackle inflation “until the job is done”. “History strongly cautions against premature policy relaxation,” Powell told the Cato Institute, a libertarian think tank based in Washington, D.C. “I can assure you that my colleagues and I are strongly committed to this work and will keep it until the job is done.” Asia Pacific markets were higher as investors digested the central bank news carnage and US stock futures were also in the green. Meanwhile, world leaders paid tribute to Queen Elizabeth II after Britain’s longest-serving monarch died on Thursday aged 96. The Bank of England announced on Friday that it will postpone the September Monetary Policy Committee meeting by a week as the country enters a period of national mourning.
