The Economics to markets and prices is the unifying feature across all national central banks as Import and Export Lines. Import and Export lines in every nation correlates +80%. Interest rates Correlate to Import and Export lines at 70% and 80%. Exchange rates correlate to Import and Export lines at 70% and 80%.
The alignment to Imports, Exports, interest and exchange rates is a permanent feature of Economics, markets and central banks as all move together in unison as one big giant block. Proper alignment determines a healthy economy.
Inflation shares negative correlations to Imports, Exports, Interest and exchange rates. The sidebar issue is Producer Prices Correlates to Inflation at +13%. This relationship and concept is a non issue.
Based on years of monthly and yearly data for the Fed and BOJ, leaders of the Fed fail to view Import, Exports, Inflation and Exchange rates in determination to change interest rates. The change of interest rates on every interest move occurred at the wrong times. Every change to interest rates had the opposite effects as higher Inflation persisted.
The number of raises and drops particularly in succession was a sledgehammer and not required in relation to Import and Export lines. king Powell raised Fed Funds 500 points when only 25 points was required.
Powell in 2019 lowered Fed Funds 75 points when Import and Export Lines were negative. Powell drove the lines into further negative territory. While Import and Export lines were deeply negative in March 2020, Powell slashed Fed Funds 150 points.
As Import and Export Lines bottomed in 2020, a massive climb began to Imports 13.0 and Exports 20.0 by March 2022. The Import and Export Lines lifted Inflation to 9.1. Previous Import and Export Lines at 13.0 and 20.0 was seen briefly in 2021 and 2015.
As Imports and Exports began the monthly climb, Inflation was Imported to every nation on the planet by higher Import and Export lines to all nations.
The BOJ intervened on USD/JPY in September and October 2022 because BOJ Import and export lines threatened trade by a massive and continuous rise. Powell forced the BOJ to intervene by importing Inflation.
The March 2022 raise at 25 points was the only requirement as Import and Export lines began dropping every month. Powell required time as Import, export and Inflation numbers are slow movers.
Today’s Import line at -0.8 and -1.8 for Exports is again not a perfect time to touch interest rates as a cut forces Inflation higher. The Import and Export lines will assist to Inflations rise.
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