The US Federal Reserve’s meeting minutes showed that it held an interest rate hike of half a percentage point at its June and July meetings.
This negatively affected the behavior of investors and trading in global markets and stock exchanges during today’s session, Thursday, May 26, 2022.
The dollar fell to its lowest level in a month
The dollar fell towards its lowest level in a month, Thursday, following the statement of the Federal Reserve (the US central bank) came without any surprises, as most of the participants in the meeting supported raising interest rates by 50 basis points in its next two meetings.
The dollar index, which measures the performance of the US currency once morest a basket of six major currencies, fell 0.2 percent to 101.83 following the US Central Bank statement revealed that it is likely to adhere to the monetary policy path set at the present time, but it left the field open to a group of options following July.
The yield on US 10-year Treasury bonds fell 1.4 percent in the latest trading at 2.7308 percent, following earlier falling to its lowest level since April 14.
The offshore Chinese yuan fell more than 0.5 percent to 6.75 once morest the dollar. The euro rose 0.35 percent to $1.0716, while the dollar fell 0.4 percent to 126.76 yen.
Risk-sensitive currencies such as the Australian and New Zealand dollars were broadly flat once morest the dollar.
The pound rose to a three-week high of $1.26165 before an expected announcement by British Finance Minister Rishi Sunak of a package of measures to help consumers adjust to rising energy bills.
As for cryptocurrencies, bitcoin was down 1.1 percent in its latest transactions to $29166, while ether fell more than five percent.
Gold continues to decline
While gold prices fell for the second session in a row, Thursday, as a result of the US Central Bank’s affirmation of its intention to continue its monetary tightening policy and raise interest rates, thus harming gold as a non-returning asset.
And the price of gold in spot transactions decreased by 0.4 percent to $ 1844.90 an ounce by 1215 GMT. US gold futures fell 0.1 percent to $1,844.20.
The minutes of the Fed’s May 3rd and 4th meeting showed that all of the meeting participants supported a half percentage point increase in the key rate to fight inflation, although that came as no surprise to the market.
Thus, the yellow metal is heading towards recording a decline for the second month in a row, following prices reached their lowest level in three and a half months earlier this month.
As for other precious metals, silver fell in spot transactions 0.6 percent to $21.83 an ounce. Platinum fell 0.7 percent to $ 937.53, and palladium fell 0.2 percent to $ 2001.41.
US stock gains
The Standard & Poor’s 500 Index and Dow Jones rose at the open, Thursday, following strong earnings expectations from companies such as Macy’s, while data revealed that the US economy contracted in the first quarter of the year, easing some concerns regarding a large and rapid hike in interest rates.
The Dow Jones Industrial Average rose 127.89 points, or 0.40 percent, to open at 32,248.17 points.
The Standard & Poor’s 500 index rose 5.87 points, or 0.15 percent, to 3,984.60 points.
The Nasdaq Composite Index dropped 24.90 points, or 0.22%, to 11,409.84 at the open.
Unemployment benefits decline in the United States
And on the course of the American labor market’s response to the “Federal” monetary measures and its efforts to contain inflation and bring the rate down towards the target, the number of Americans who submitted new applications for unemployment benefits decreased last week, in line with the conditions of the labor market that is still witnessing a crisis amid strong demand for workers to Despite raising interest rates and tightening financial conditions.
The Labor Department said Thursday that applications for state unemployment benefits filed for the first time fell in the week ending May 21 by 8,000 to 210,000, following adjusting the numbers in light of seasonal factors. The decline partially moderated the increase in the previous week, which saw orders increase to their highest level since January.
Economists polled by Archyde.com had expected the number of applications to reach 215,000 in the last week.
However, others believe that some retailers were laying off workers. Several retailers, including Walmart, last week cut their full-year profit forecasts, warning that inflation is slashing profits.
