Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew February 1 2023

Morning Brew 1 minute to read
Erik Schafhauser

Senior Relationship Manager

Summary:  Fasten your seatbelts

Good Morning, 

Fasten your Seatbelts for an intersting start to the 2nd month of the year. – today we are fully entering the key days of data releases  We will start with the EU Inflation at 11 and international PMIs with the key at 15:45 and 16:00 out of the US. Then the FOMC will announce rates at 20:00 and hold the press conference at 20:30 CET. Meta earnings will be released after the bell.

Our strategist Charu Chanana states With economic data in a Goldilocks situation in the US, the Fed’s likely downshift to 25bps rate hikes makes the most sense as it buys them more time to assess the growth and inflation trajectories

We say yesterday the degree of nervousness prevailing as risk initially gave in to pressure before recovering. The US500 fell below 4000 to recover to 4075, 4065 now, the GER 40 traded from 15125 yesterday morning to 14988 to rise 15191 and 15125 now. EURUSD 1.0550 to 1.0800 then 1.0870 now.  Gold and Silver tested the 1900 and the 23. 00 to rise back to 1928 and 23.70.

Strong earningns as well as a lower than expected rise in employment costs caused the change in mood.

Exxon gained 2.2%, GM 8.3%, UPS 4.7% while Catarpillar declined 3.5%. Labor Costs in the US rose only 1% - easing fears of secondary inflationary effects.

What to expect today?

Traders are fairly certain of a hike by 25 Basis points – the traded probability is 69.8% right now, the remaining 3.2% see a 50 Bps hike. Plainly put, it would be a huge surprise if we were anywhere but at 4.6% after the decision.

The path from there is currently seen with another hike of 25 Bps in Marc (22nd) with a decent probability, the implied rate is 4.79. In May the implied rate goes to 4.9% meaning 50% chance of a further 25 BPS increase.  Hope is for a 2 and done as our Steen Jacobsen calls it – so 50 BPS higher terminal rate.

The rate in December is seen to be 4.47 so slightly above the current level. Any change to this path is likely to be key today.

While the Vix is fairly low (it usually is when stocks are on the rise) 1 week EURUSD ATM Fol I near 11%, GBP at 11.5 and Silver at 26%.

Expect very nervous moves for the next three days.



International PMI thorough the day, EU HICP

FOMC Rate decision

Earnings: Altria, T-Mobile, Peleton, ThermoFischer, Meta,


Band Of England, ECB Rate decision

Earnings:   Merck, Lilly, Honeywell, Sony, Amazon, Apple, Alphabet, Ford, Qualcomm, Starbucks, Gilead,


International PMI, Nonfarm Payroll

Earnings:  Cigna, CBoe, Sanofi



The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15

Contact Saxo

Select region


Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.