At the moment, markets are betting that interest rates will be raised at an average of 75 points or 100 points.
If it’s a 100-point increase, a jumbo hike, a collapse might happen in indices, stocks, metals, and all currencies facing the US dollar. Although unlikely, this scenario is possible.
What matters more is the press conference of the Federal Open Market Committee scheduled after the Fed’s decision. If it is mentioned in the minutes that interest rates will continue to be raised in large percentages in November and December, with the statement that there is no fear of recession because the American economy and the labor market are strong, indices and stocks will initially be pushed to the downside as a reaction to the interest hike, and then will go back to rising due to the exclusion of the risk of recession.
But if the minutes say that it will continue to raise interest rates with a real fear of recession, then we will witness a collapse in stocks and indices.