Expectations on Fed’s interest rate fulfilled

By 31/10/2019News
Morning Stock News

Gold   1497,64
(+ 0,58%)

EURUSD   1,1162
(+ 0,47%)

DJIA   27136,50
( + 0,44%)

OIL.WTI  55,205
(– 0,19%)

DAX   12941,05
(+ 0,05%)

The interest rate decision and FOMC press conference did not cause much volatility on the markets. The forecasts of the analysts proved true, Fed cut interest rate to 1.75%. Q3 GDP in the United States turned out disappointing; it grew just 1.9% since the beginning of the year. Markets were ready for the decision at some point and played out the result in advance.

USD/JPY Daily-Chart

USD/JPY Tages-Chart

Major US stock indices closed at their highs today. Most of US companies have already reported their profits, and Fed’s decision was quite predictable. Cut of interest rate third time in a row tells us about stability in US economy and a calm end of the year. Usually Fed prefers not to make any harsh statements before Christmas.

EURUSD

EUR/USD pair dropped after Fed announced the cut of the interest rate to 1.75%, but it recovered shortly after. Brexit and snap election on December 12 don’t give Europe much time to relax. Fundamental data on October Consumer Price Index expected on Thursday.

GOLD

Gold price declines after fundamental news from the United States came out. Selling safe haven assets was very much predictable. Appetite for risk makes investors going into more profitable assets. As both week and month coming to an end, some traders will fix their position and exit the trades.

INDICES

World indices were trading mixed amid disturbing news on China’s reluctant fulfillment of the US requirements on purchasing US agricultural products, and also upcoming FOMC press conference. All Wednesday’s news will be played out on Thursday.

What’s next?

08.30 Bank of Japan Press Conference
12.00 EU Consumer Price Index in October
14.30 Initial Jobless Claims in October, US


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