Highlights:
* Federal Reserve is close to the end of neutralizing interest rates after December hike.
* US stocks, forex instruments, and Gold extended gains Wednesday, but correcting Thursday.
* Bitcoin, Ethereum, XRP and the rest of the crypto market react negatively.
Federal Reserve released the minutes of its December meeting which revealed that they would follow a wait-and-watch approach towards their interest rate hike plans. The US central bank suggested in December moderate rate hikes (up to 2.8 percent) but preferred to implement them only if warranted. The Federal Open Market Committee (FOMC) confirmed that their rates were close to the range of its long-term neutral interest rate – implying a pause in their hikes.
At the same time, the Fed highlighted that market tightening and global economic slowdown have made it difficult to assert future policy making.
US Stocks, Gold Extend Gains – Forex Corrects
The pause of rate tightening cycle sent the US Dollar to its three-month low. The quoted instruments against the greenback naturally took the news well, with mainstream US stocks, forex pairs, and precious metals noticing an interim surge. The Dow Jones closed Wednesday at 91.67, up 0.39 percent, while the S&P 500 advanced 0.41 percent and the Nasdaq Composite Index rose by 0.87 percent. It was the fourth consecutive upside session for the said markets.
Gold price opened Thursday on a positive note. The spot price was up 0.2 percent at $1,289.50 per ounce as of 1200 GMT. US gold futures rose 0.4 percent to $1,297.20 per ounce.
The Forex market is now following a remedial course. The EUR/USD corrected lower towards 1.1500 from overbought levels while the GBP/USD also edged down at 1.275 from its morning opening rate. Poor Asian data hampered the Japanese Yen from benefitting from the dovish Fed minutes. The USD/JPY rate this Thursday established fresh weekly lows, now inside 107.80-107.75 area from 109.00-region.
CCN |
https://www.ccn.com/dovish-fed-minutes-sees-cryptocurrency-market-lose-11-billion-in-5-hours/