Reminder: The Fed is meeting this week

That is the key risk event on the calendar in the week ahead, outside of the usual Russia-Ukraine shenanigans and also the BOE policy meeting on Thursday.

We’ve gone from the Fed will hike 25 bps to the market pushing for the Fed to hike 50 bps to Fed officials paring back those expectations to a 25 bps hike. But amid a rising inflation backdrop with key upside risks in play, perhaps we could see the Fed pull off a surprise.

As things stand, the market has priced in a ~97% odds of a 25 bps rate hike. So, that gives Powell & co. some room to send a stronger message with a 50 bps rate hike. But at the end of the day, it also depends on where they see the terminal rate at but a bigger move this week could have stronger reverberations for future meetings.

In any case, regardless of the move, it is hard to see how central banks can really fix what is happening in the world right now. Monetary policy isn’t the best equipped solution and stagflation risks are something that are slowly creeping in more and more each day.

I don’t envy the position that central banks are caught in right now.

But yes, we’ll have a more comprehensive preview to follow in the days ahead but this is just a reminder for now.