While traders were expecting a 0.50% rate hike until last week, unexpectedly high CPI figures have now made a 0.75% increase likely.

The Bank of England will also meet tomorrow, and is expected to announce a 25bp rate increase, although a 50bp hike is not included if the Fed turns very hawkish.

The FTSE 100 was up 0.5% this morning, lifted by financial stocks, including HSBC, and several strong corporate earnings reports.

Whitbread jumped 3.4% after posting higher first-quarter sales, as tourists returned to hotel after easing Covid restrictions.

 

Things to read today:

Fed begins quantitative tightening on unprecedented scale (Financial Times)

ECB Council to Hold Emergency Meeting to Address Market Selloff (Bloomberg)