Now Trump is blaming the Fed for creating a “false economy” with its emphasis on extremely low interest rates.
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A weaker-than-expected reading on the USA services sector in August added to views the Fed will refrain from raising interest rates at its meeting this month.
“The likelihood for a hike in September dropped sharply and the likelihood in December also dropped somewhat and hasn’t risen back to the level before USA data”.
The bank last week put 55 percent odds for a hike at the Fed’s September 20-21 meeting and 80 percent odds by the December meeting.
The euro maintained Tuesday’s 0.96 per cent rise against the dollar, the biggest daily gain in three months on Tuesday and last stood at US$1.1247.
Though oil prices ended lower, the S&P 500’s energy index rose 1.5 percent, helped by Enbridge’s (ENB.TO) acquisition of Spectra Energy (SE.N) for about $28 billion. The emerging market stocks had an excellent day since July as it jumped 1.3 percent.
Speaking to a group of reporters on a flight to OH, the Republican nominee answered a question pertaining to the United States central bank’s intentions to raise interest rates later this month.
However, Tokyo sank 0.7 percent by the break as the yen extended gains against the dollar following the US PMI reading.
Falling expectations for a rate hike sent U.S. Treasury yields lower, with benchmark 10-year Treasury notes US10YT=RR were up 1/32 in price to yield 1.5391 percent, from 1.543 percent on Tuesday.
In the mining space, BHP Billiton is adding 0.4 percent, Rio Tinto is advancing 0.5 percent and Fortescue Metals is rising more than 2 percent. The FTSE 100 index of leading British shares finished the session 0.2 percent lower at 6,879.42.
South Korea’s Hanjin Shipping won a U.S. judge order extending bankruptcy protections so its vessels can dock at USA ports without fear of creditors trying to seize the ships, Reuters reported.
The Stoxx Europe 600 index erased gains after the USA economic report.
Markets were watching for China’s August foreign exchange reserves, Malaysia’s central bank rate decision and the US Fed Beige Book. On a drop back below $1,335, the contract becomes vulnerable to a return to key support at $1,308 an ounce, representing the June 28th low, which was tested and reinforced with the July lows.
Gold futures for December delivery posted the longest rally since August 2. Because of the U.S. Labor Day holiday, electronic transactions from Monday were booked with Tuesday’s for settlement purposes.
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Oil prices edged up after early losses but gains were limited after talks between Russian Federation and OPEC kingpin Saudi Arabia at the weekend did not produce any plans on addressing a global supply glut. It was last down 0.2 per cent at US$0.7668 after GDP data largely met expectations, with Australia’s annual growth clocking its fastest pace in four years last quarter, clinching a remarkable run of 25 years without recession.
