Economists focus on the upcoming FOMC session because the global market movement slows down-Economics
Economists focus on the upcoming FOMC session because the global market movement slows down-Economics
The global markets have felt the pressure of fear and uncertainty, since the upcoming Federal Open Market Committee (FOMC) is planning to make a decision on Wednesday to change the current monetary policy loosening policy and to raise the reference interest rate. Economists and market analysts fear that the restrictive Federal Reserve will tighten the markets too quickly after the central bank has expanded the US money volume like never before in history.
chief economic consultant of the Allianz: "The Fed kept for far too long in its narrative of the temporary inflation"
All eyes are directed to the Federal Reserve this week conversation has turned into speculation about the upcoming Fomc session. The committee will make a decision on Wednesday at 2 p.m. (EST) that follows a press conference by the Central Bank's chairman, Jerome Powell. Last week the global stocks were aggravated and fell significantly, while the cryptoma markets hit the same way as crypto economy Lose billions in value . Precious metals such as gold and silver managed to ward off market slump, and both metals have increased by a few percent in the last 30 days.
Since the US Federal Reserve has indicated a tightening of the quantitative loosening (QE) and an interest rate increase, the critics of the Fed The pivot point is too fast . One of these critics is Mohamed El-Erian, chief economic consultant of the financial service provider Allianz. "The first political mistake was to understand inflation completely wrong," said El-Erian on Tuesday. He added that the Fed Governor Council "held on to its temporary inflation count for 2021 for far too long and missed time windows for time windows to slowly take the foot from the stimulus accelerator".
fomc tomorrow, probably from today until then
- Tradersz (@trader1sz) 25. January 2022
Now that the FED seems to move towards a rapid tightening of the monetary policy relaxation, retailers and analysts are afraid of building new positions on the market. "I would be very [reluctant] to check whether we can get into anything or increase positions until we hear from an increasingly restrictive Fed on Wednesday," said Marc Lopresti, Managing Director at Strategic Funds. told the press Monday.
market participants try to predict the schedule for the monetary policy tightening of the Fed
While the FOMC session was trendy on social media and forums, it was also analysts The decision at the premature
The Fed published some of its FOMC data for 2023. So I was able to expand this table. Here is the latest pic.twitter.com/6qwxj1aevm - Jim bianco biancoresearch.eth (@biancoresearch) 24. January 2022 The predictive markets operated by kalshi.com are also tries to forecast when the US note bank will lift the key interest rate. 98 % of those who use the Fed forecast market from Kalshi.com say that the Fed will raise the interest rate in July to over 0.25 %. The least chosen month was December 2022 and 84 % chose this specific date. The financial analyst on Twitter with the name " mac10 " explained that market bulls have to break their strength. "As I see it, either the market between now and the FOMC collapses and forces the Fed to turn back," said Mac10 wrote . "Or the Fed opens up restrictively and the market breaks down. I don't see a gold lily of the bell scenario. Bulls, something has to break so that the Fed can reverse. This is something." Mark Haefele, Cio Global Wealth Management at UBS, believes that the upcoming FED session will "underline" the current way of thinking of the Fed. "Over the most recent decades, the market volatility was calmed down by the idea that the Federal Reserve and other global central banks were willing to intervene in order to support the economy in the event of a weakness, exogenous shocks or unexpected tightening of global financial conditions", Häfele said in a explanation on Tuesday. "Today, since inflation is still high, this support feels less secure, and the FED session this week will probably underline the shift in the political priorities of the Fed from the support of growth and to combat inflation," added Haefele. If the Fed does not reverse the course during the FOMC session on Wednesday, I think that everything will go further than most expect. as soon as you inevitably turn back, #bitcoin jumps big quickly📈. - Joe Burnett (🔑) ³ (@iiicapital) 24. January 2022 The key figures recorded 24 hours before the FOMC meeting show that the stock markets were somewhat easier at the end of the day on Monday. Tech shares, Nasdaq, Nyse and the Dow Jones ended the day in the green, and the markets for cryptocurrencies saw a similar pattern. On Tuesday morning, the crypto economy has increased $ 8.5 % to $ 1.7 trillion in the last 24 hours, with leading crypto-assets such as Bitcoin ( Bitcoin ) and Ethereum ( eth ) on the last day.
What do you think of the upcoming FOMC session and the possibility that the Fed will pay the money policy loosening too quickly? Share your opinion on this topic in the comment area below. Bedy verification : Shutterstock, Pixabay, Wikicommons
UBS board: "The fed session this week will probably underline the displacement of the political priorities of the Fed"
