Indian shares look set to open a tad higher on Thursday after minutes from the Federal Reserve’s July 27 policy meeting showed the USA central bank was in no hurry to raise interest rates.
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Analysts at Rabobank said they expected a rate hike as soon as in December, but added that a postponing until next year won’t be a surprise. The very same day, New York Fed President William Dudley made similar intimations at an unrelated event.
San Francisco Fed President John Williams speaks on economic outlook in Anchorage, Alaska at 4:00 p.m. ET.
The Fed raised its target range for the federal funds rate by 25 basis points to 0.25-0.5 percent in December, the first rate hike in almost a decade.
Taken during the July 26-27 meeting, the minutes detailed policy makers’ differing views of the USA economic outlook as they chose to leave a key interest rate untouched at 0.25-0.5 percent.
“They saw little evidence that inflation was responding much to higher levels of resource utilization and suggested that the natural rate of unemployment, and the responsiveness of inflation to labor market conditions, may be lower than most current estimates”.
“The minutes contained more concrete indications that a consensus to raise rates is slowly building”, said Brian Dolan, head market strategist at Drivewealth in New Jersey.
In the Dow, gains in shares of Pfizer and those of DuPont, up 0.8 % each respectively, offset slides in shares of Cisco and those of Intel, down 1.2 % and 0.8 % respectively.
Fed officials have also expressed concern about the tepid pace of United States growth, weakness in worker productivity, excessively low inflation and the long-term consequences of Britain’s vote to leave the EU.
Demand for gold and other precious metals is likely to drop should that ratio continue higher.
The Malaysian ringgit tacked on 0.5 percent against the United States unit, while the Indonesian rupiah was up 0.3 percent and the Thai baht rose 0.2 percent.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.46 percent to 957.78 tonnes on Wednesday.
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LONDON, Aug 18 The dollar hit a seven-week low against a basket of major currencies on Thursday, after minutes from the Federal Reserve’s July meeting showed policymakers were divided on raising interest rates in the near term. Platinum at $1,124/1,131 was up $8.50 and palladium at $696/705 climbed $7.50.
