Donald Trump should be satisfied with the FED

Daily Analysis - 29/11/2018

Powell's surprised dovish speech weakens dollar


The president of the United States Donald Trump should be satisfied after Jerome Powell's surprised speech that dinted the market. The speech has a more dovish tone and did not specify a prospect for a 'gradual path of rate hikes next year'. The greenback suddenly dropped upon the speech and the S&P 500 gained 40 points after the speech. Powell said that he probably is not going to follow the hike policy again and would be directed by economic data. He also said that the rates remained just below the neutral area. This indicates that presumably after next month’s rate hike the Fed will probably pause interest rates increases next year to evaluate actually how much they need to rise. Now with the oil dropping many experts anticipate that to lessen the inflationary stress is one of the reasons that the Fed is not going to continue toward a gradual hiking policy.

Asia markets trade higher after Fed Comments

The Topix index scored 5.80 points, to 1,659.46 while Japan's Nikkei 225 climbed 85.57 points which are about 0.38% at levels 22,262.4. Now South Korea's Kospi was raised by 5.87 points that is 0.28 %, to 2,114.0.

On Thursday Asia markets exchanged mainly higher before of a significant conference between Chinese leader Xi Jinping and President Donald Trump. Several nations are expecting that this probably is going help reduce the trade tensions between the two countries.


Oil getting stronger ahead of G20 meeting

On Thursday oil rates raised due to an expectation that trade discussions at the G20 gathering may benefit the global market and increase the demand opportunity. International benchmark Brent crude climbed about 27 cents, to about $59.0 a barrel, a fall 2.4% yesterday to $58.76 a barrel.

U.S. crude futures climbed 38 cents, to $50.65 per barrel. The market closed yesterday's session below 2.5% after falling to the lowest level since last year.


Gold goes up as greenback softens

U.S. gold futures has changed very little at $1,223.0 per ounce.

On Wednesday Gold prices rose about 0.6 % and that was their largest single-day percentage increase since the middle of November. Spot gold increased 0.3% at $1,224.13 per ounce.

On Thursday Gold gained while the greenback hesitated after some dovish remarks from U.S. Federal Reserve Chair Jerome Powell, calming trader’s anxieties over the speed of rate hikes.


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