18 March 2021
World Markets at a glance for Currency, Equity, Bonds, Commodities, Crypto Currency, Financial News and major Economic Events
Dollar wobbles after Fed pushes back against rate hike speculation
Stocks rise after Fed tames inflation fears, projects U.S. GDP surge
The U.S. dollar was on the defensive on Thursday after the Federal Reserve signalled it was in no hurry to raise interest rates through all of 2023 even as it saw a V-shaped recovery in the world’s largest economy.
Investors dumped the dollar and rushed to more risk-sensitive currencies as Fed Chairman Jerome Powell, true to his dovish credentials, dampened speculation a stronger economic outlook could propel the central bank to wind back its stimulus.
The dollar index dropped 0.5% to its lowest levels in two weeks and last stood at 91.400. The dollar slipped to 108.87 yen, off Monday’s nine-month top of 109.365 while the euro rose to $1.1980, edging near last week’s high of $1.1990.The British pound traded at $1.3970, having gained about 0.5% overnight. The Bank of England is expected to keep its benchmark Bank Rate at a historic low of 0.1% and its bond-buying program unchanged at 895 billion pounds later in the day.
The 10-year U.S. Treasuries yield gyrated wildly before settling around 1.648% for now, having hit an 13-month high just before the Fed’s announcement.
Asian shares and U.S. stock futures rose on Thursday after the Federal Reserve committed to maintaining accommodative monetary policy and projected a rapid jump in U.S. economic growth this year as the COVID-19 crisis eases.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.99%, while stocks in China rose 0.46%. Australia’s market bucked the trend and fell 0.3%. E-mini futures for the S&P 500 advanced 0.3%.
The S&P 500 closed at a record high on Wednesday and the Dow Jones Industrial Average closed above 33,000 points for the first time, bolstered by the Fed’s strong economic forecast and Powell’s comments that it is too early to discuss tapering-off measures.
While inflation is expected to reach 2.4% this year, above the central bank’s 2% target, Fed Chair Jerome Powell called it a temporary surge that will not change the Fed’s pledge to keep its benchmark overnight interest rate near zero.
Oil prices dropped for a fifth day on Thursday after official data showed a sustained rise in U.S. crude and fuel inventories, while the ever-present pandemic clouded the demand outlook.
Brent crude was down 12 cents, or 0.2%, at $67.88 a barrel by 0119 GMT after dropping by 0.6% on Wednesday. U.S. oil was also down 12 cents, or 0.2%, at $64.48 a barrel, having fallen 0.3% the previous session.
Government data on Wednesday showed U.S. crude inventories have risen for four straight weeks after refineries in the south were forced to shut due to severe cold weather. An industry report estimating a 1 million barrel-drop had raised hopes the run of gains might have stopped.
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Major Economic Events
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