Gold is reeling, stocks are falling, and oil is soaring… Market movements after the Fed’s announcement
The The Federal Reserve, today, Wednesday, decided to stabilize the main interest rate, at a time when policymakers seek to confront high inflation, mixed indicators in the labor market, as well as the American war with Iran. In a widely expected decision, the Federal Open Market Committee voted 11 to 1 in favor of keeping the benchmark federal funds rate within a range of 3.5% to 3.75%. In Stock markets, witnessed "Wall Street" A collective decline in major indices, the most prominent of which was the decline of the Dow Jones Industrial Average by about 750 points, recording its lowest level since the beginning of the year. This decline came after new US economic data, in addition to the statements of the Chairman of the Federal Reserve, raised more concerns about the continuation of inflation in the country.
Gold and silver decline in the face of the strength of the dollar
Traditionally known as the relationship between Goldand interest rates have an inverse relationship, as the precious metal tends to achieve higher profits in an environment of low interest rates, and vice versa. The price of gold in spot transactions fell by approximately 4% to $4,818 per ounce, and in the other precious metal, silver, the price of the white metal fell by 5% to $75 per ounce. On the other hand, interest rates revived the US dollar index, strengthening its position as a safe haven, and making gold, which is usually denominated in the dollar, more expensive for holders of other currencies.
Oil flies solo
In a related context, oil prices jumped by 5%, with the escalation of the Iranian war, and exacerbated fears of long-term inflation as a result of the skyrocketing energy costs. Brent crude futures rose 5% to $108.56 per barrel, while US West Texas Intermediate crude rose $2.17, or 2.3%, to reach $98.38.
Cryptocurrencies: Continuing Suffering
Exposed Digital currencies, led by Bitcoin, came under severe pressure today, Wednesday, as it fell by 3.7% to 71.1 thousand dollars, after almost touching 75 thousand dollars at the beginning of the session.
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