Rate hikes go global

Good morning, readers. Phil Rosen here, writing to you from a coffee shop in Manhattan.

Powell and co. last week chose to "skip" an interest rate adjustment, holding them steady after 10 straight hikes but cautioning that more raises could still happen.

The rest of the world did not follow suit. 

The central banks of the UK, Turkey, Norway, and Switzerland all raised interest rates yesterday. 

Here we go.

1. Let's start with the Bank of England's decision to raise interest rates by 50 basis points and bring borrowing costs to 5%. 

The move from across the pond surprised experts all over, and policymakers effectively said high inflation and a tight labor market justified the decision. 

The UK's inflation reading climbed by 8.7% in the 12 months through May, and core inflation increased to 7.1% from 6.8% in the month before.

"Inflation is not playing ball, therefore, the Bank of England felt it had little option but to crank up interest rates even more this time around despite the broader implications of the uptick in borrowing costs," Interactive Investor analyst Myron Jobson said.

The UK's benchmark rate is now at the highest level since 2008. 

Turkey's central bank, meanwhile, raised interest rates by 650 basis points to 15%, which was somehow less than markets expected. 

The move reflected a course change following the re-election of President Recep Tayyip Erdogan, who last year pressured the bank to slash rates despite soaring inflation. 

Inflation in Turkey hit a two-decade high of 85.5% in October, but dropped to about 40% in May.

One critical outcome of yesterday's rate hike was that the Turkish lira plunged 4%, hitting its lowest level on record. 

It now takes roughly 25.69 lira to buy a single US dollar, as of Friday morning. 

Just to cover our bases: Norway's central bank raised its core lending rate by half a percentage point, and Switzerland's policymakers hiked its benchmark rate by a quarter point.

What's your outlook for the global economy for the next six months? Tweet me (@philrosenn) or email me (prosen@insider.com) to let me know.

In other news:

2. Goldman Sachs just named 50 stocks poised to increase profitability faster than the rest of the market. Even with slowing macroeconomic conditions, certain names could still see plenty of upside over the next 12 months. See the full list.

3. The co-leader of an AI-driven quant fund shared two stocks his model is betting the most on right now. Find out the names and the simple strategy investors can use to pick stocks with the help of AI.

4. BMO Capital Markets selected their favorite cheap, fast-growing stocks in the under-the-radar industrials sector. This corner of the market is brimming with opportunity, strategists said, and it's outperformed in June. Here are 16 stocks to watch.

5. Warren Buffett just donated about $5 billion worth of Berkshire Hathaway shares. After his gift to the Gates Foundation and other charities, the billionaire has given up more than half his stockpile.

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This newsletter was curated by Phil Rosen.