Federal Reserve Holds Rates as Global Inflation Fears Mount

US equities experienced a volatile week due to ongoing conflict in the Middle East and the Federal Reserve's hawkish stance. Fed Chair Kevin Warsh reiterated that interest rates would not be adjusted, despite core PCE inflation coming in at 3.7% in line with expectations.

In the Eurozone, inflation rose to 2.9% in July as energy costs increased due to conflict-driven price hikes. The Bank of England kept interest rates on hold, but a growing number of policymakers voted for a hike amid ongoing uncertainty over the war's inflationary impact.

The Bank of Japan left rates unchanged, warning that core inflation was likely to exceed its 2% target from September. China's manufacturing PMI decreased to 49.2 in July, below forecast of 50.0.