European stocks edge higher, yields rise as markets adjust rate expectations

Published by
Reuters UK

By Elizabeth Howcroft LONDON (Reuters) – European stock indexes opened slightly higher on Tuesday, while U.S. and European government bond yields rose to new multiyear highs as investors adjusted their expectations for rate hikes following hawkish comments from the U.S. Federal Reserve. Fed Chair Jerome Powell said that the central bank could move “more aggressively” to raise rates to fight inflation, possibly by more than 25 basis points at once. Markets scrambled to recalibrate the higher possibility of a 50 bps hike. On Tuesday morning, money markets were pricing in a 80% chance of a 50 bps…

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