Precious metals, cryptocurrencies and stock markets fluctuate according to Powell's explanations on the rate increase - Economics
Precious metals, cryptocurrencies and stock markets fluctuate according to Powell's explanations on the rate increase - Economics
stocks, cryptoma markets and precious metals developed well during the trading sessions in the early morning on Wednesday, shortly before the US Federal Reserve completed its meeting of the Federal Open Market Committee (FOMC). While the Fed said in an explanation that the reference interest rate would soon increase, the chairman of the central bank, Jerome Powell, said the committee "intended to raise the key interest rate at the March meeting". Together with discussions about reducing the balance sheet by investors, Powell's statements after the meeting were considered restrictive, and the global markets were lost in value.
fomc says that it is planning to raise the Federal Funds 'soon', Fed chairman Jerome Powell insists that interest rates will change in March
After a week of dark markets, the with excitement Expected The meeting of the Federal Open Market Committee (FOMC) took place, and the members of the committee unanimously agreed to leave the interest rates at a level close to zero.
"With an inflation of well over 2 percent and a strong job market, the committee assumes that it will soon be appropriate to raise the target area for the Federal Funds Rate," said the FOMC in a statement on Wednesday. While the statement of the financial institution "soon" highlighted, this meant that the US Federal Reserve is planning to leave the base interest rate unchanged at least for the time being.
Fed boss Jerome Powell explained that the key interest rate could rise in March. Powell also noted that it would take some time to lower the Fed's balance sheet.
"The balance sheet is much larger than necessary," said Powell of the press. "The balance sheet has to be shrunk considerably. It will take some time. We want this process to be ordered and predictable." Since everyone was still held on the "soon" statement of the FOMC, Powell emphasized:
The committee intends to raise the Federal Funds Rate at the March meeting, provided that the conditions are appropriate.
stocks, cryptoma markets and precious metals decrease according to Fed statements
When the stock markets closed, the Nyse fell by 103 points and the Dow Jones Industrial Average by about 129 points. The NASDAQ index was able to hold over a few percent and the S&P 500 lost a few percent.
The price for an ounce 0.999 fine gold fell by 1.77 % and the value of an ounce 0.999 fine silver lost 2.48 %. Of course, gold bug and economist Peter Schiff threw his mustard about the Fed meeting and Powell's statements.
"Powell said that the Fed would start to shorten its balance sheet in due course," said Schiff . "Then he said he really had no idea when it could be because the FOMC hadn't even talked about it. Really? What exactly do they talk about when they meet, sport? We're on the ass and they know." Some people drafted ship because the gold price has slipped according to Powells.
The global market capitalization for cryptocurrencies does not do too well because it declined by more than 2 % to 1.71 trillion. The leading crypto-asset bitcoin (btc) was quite volatile and within two five-minute candles before the explanations of the fed were published, Bitcoin rose from Bitstamp from $ 38,946 $
metrics show Bitcoin ( bitcoin ) during the day Unit. Many other top ten crypto-assets lost a few hours after Powell's statements between 2 % and 7 %.
What do you think of the FOMC session and the statements of Jerome Powell? What do you think about the following market reaction? Let us know your opinion on this topic in the comment area below.
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