• USD leads, GBP lags on the day
  • European equities higher; S&P 500 futures down 0.6%
  • US 10-year yields up 2.9 bps to 2.944%
  • Gold up 0.9% to $1,897.50
  • WTI up 0.8% to $107.10
  • bitcoin down 0.9% to $39,461

The post-FOMC moves yesterday are retracing back slightly as the dollar firmed, bond yields crept higher and US futures are marked lower in European morning trade. But the pound is the big mover as it crumbled amid a dovish rate hike by the BOE, with the central bank painting a rather bleak picture of the UK economy moving forward.

Stagflation risks are what stands out as policymakers predict 10% inflation this year with the economy contracting at the end of the year and grinding to a halt in the early stages of next year.

That is enough to drag the pound to fresh lows since July 2020 as cable tumbled from 1.2540 to below 1.2400 currently.

Meanwhile, there is still some debate to the peak hawkishness message from the Fed yesterday as markets scaled back on the post-FOMC moves. EUR/USD moved down from 1.0600 to 1.0550 while USD/JPY jumped up from 129.30 to near 130.00 again currently.

AUD/USD also gave up gains from around 0.7240 in a fall to 0.7190 at the moment.

This comes as bond yields are staying higher with 10-year Treasury yields still lingering just below the key 3% mark.

Elsewhere, stocks are also looking more guarded with US futures holding lower once again as yesterday's late spark may yet prove to be fleeting.