Ipek Ozkardeskaya
Swissquote Bank Ltd
Federal Reserve (Fed) Chair Jerome Powell’s testimony yesterday wasn’t overly optimistic but it revived the expectation that a rate cut could come sooner rather than later.
In the first day of his semiannual testimony before Senators, Powell said – for the first time in three years – that inflation is no longer the only threat to the US economy but the cooling jobs market also is. Although he didn’t want to offer a clear timeline when asked when the Fed would lower interest rates, Powell said that the latest jobs report sent a ‘pretty clear signal’ of a cooler labor market.
US yields fell, major indices advanced to fresh records but the US dollar remained bid on a euro selloff after Moody’s warned France about risks to its credit rating should government finances get worse.
Elsewhere, US crude cleared a minor Fibonacci support yesterday and nat gas remains under pressure near oversold market conditions. Inflation in China came in below expectations, while the Reserve Bank of New Zealand (RBNZ) maintained its policy rate unchanged at 5.5% for the 8th straight meeting but hinted that the degree of restraint will be gradually adjusted to the expected decline in inflationary pressures.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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