Interest and stock prices
Global stocks are on their way to achieving the first weekly rise in a month, which is an indication of the relief of the markets following giving them a warning of entering the bear market that is worrying traders due to monetary tightening, energy problems and slowing growth in China.
“Markets are finally getting to grips with the fact that US interest rates are almost certain to rise by 75 basis points,” Joanne Finney, partner and portfolio manager at Advisors Capital Management, said on Bloomberg TV. She added: “What we are seeing may indicate an acknowledgment that the selling we saw in the second half of August may have been a bit exaggerated.”
Speaking at a conference, Powell said, “We need to act now, frankly, and aggressively as we’ve been doing,” adding, “My colleagues and I are deeply committed to this project and will continue to do so.”
The strength of the US dollar amid the tightening of US monetary policy is straining countries around the world due to the weakness of their currencies. In Japan, officials gave the strongest hint yet of possible direct market intervention, sending the yen higher.
Stocks rebounded in Hong Kong ahead of a long weekend in China. Mainland China shares also rose, with an unexpected moderation in inflation in August, giving policymakers in Beijing more leeway to support the economy.
