This is what’s caught our eye over the last 24 hours.
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The Standard & Poor’s 500 index rose 15 points, or 0.7 percent, to 2,178. All the three key USA indexes registered stable gains with the Nasdaq closing at its all-time highest settlement.
Raw-materials producers also led gains in Asia.
The Dow Jones Industrial Average climbed 115 points, or 0.6%, to 18409 and the S&P 500 advanced 0.5%.
Indeed, the committee said that near-term risks to the economic outlook “appear roughly balanced”, which is more-or-less the same sort of lingo the Fed used in 2015, before hiking rates toward the end of the year.
The view that the labour market is not close to overheating is also central to Dallas Fed President Robert Kaplan’s view that the Fed should be patient and cautious in raising rates.
The dollar gained 0.3% against the yen to Yen100.6500, inching up from a steep decline in the previous session as investors digested the latest news from the Bank of Japan and Federal Reserve. “I think the market continues to be focused on the Fed pushing a hike for later as a good thing rather than bad”.
Wall Street rose on Wednesday, with the Nasdaq closing at a record high as the rate decision whetted investor appetite for equities.
Goldman Sachs said its U.S. economics team assigns a cumulative 65% probability to a rate hike by the 14 December FOMC meeting, which is roughly the same as implied by fed fund futures. Market pricing for a December move rose only a fraction to 59.3 per cent from 59.2 per cent, according to CME Group’s FedWatch tool.
Canada’s annual inflation rate in August dipped to a 10-month low and retail sales unexpectedly fell in July, disappointing markets and reviving talk that the Bank of Canada was more inclined to ease monetary policy than tighten.
The US dollar index is down by 0.44% to 95.24 at 7:10 a.m. ET.
ENERGIZED: Energy companies rose, following oil prices.
What’s more likely, the US and global economic news will continue to disappoint – and this could be enough to support a rising gold price. Many critics believe rates have been too low for too long and that they are strangling banks.
The Federal Open Market Committee on Wednesday made a decision to keep interest rates unchanged at between 0.25% and 0.50% and cut the number of rate increases they expect this year from one to two.
Westpac analyst Richard Franulovich noted that back in June the median “dot plot” – the rate moves expected by the Fed’s members – showed five hikes to end-2017. Now it is down to just three.
Higher interest rates in a country increase the value of that country’s currency as compared to countries offering lower interest rates. While the committee recognized that the case for rising rates had strengthened, it chose to hold of on a hike – for the time being.
Before that also comes the uncertainty of US elections, added GAM’s Hatheway.
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The major mover against the dollar, however, was the Norwegian crown, which rose more than 2 percent after Norway’s central bank left its main interest rate unchanged and suggested further rate cuts may not be needed because of a pickup in the economy.
