The US central bank is expected to raise the federal funds rate on Wednesday for the first time since the pandemic began. Analysts and economists are largely focused on this key event, as the conflict between Russia and Ukraine continues in Europe. If the Federal Reserve decides to increase the rate by a quarter of a percentage point from zero, investors are wondering how stock markets, cryptocurrency prices, and investments like precious metals will react to the news.
25 basis points increase expected – Concern revolves around Fed’s next moves
Last week, watch the world Financial penalties she was used Against Russia and the price of gold rose to an all-time high of $2,060 an ounce. Energy and oil stocks and a myriad of commodities have also jumped in value dramatically over the past seven days. Cryptocurrency markets were dull last week, volume is dropping, and movement has held steady after a short price jump on March 9, 2022.
On the other hand, stocks suffered a great deal and indices such as the NYSE, Dow Jones, S&P 500 and Nasdaq closed the day in the red on Friday afternoon (EST). making things worse, data Stemming from the US Department of Labor’s Consumer Price Index (CPI) report, which shows consumer prices surpassed a 40-year high of 7.9% in February.
This week’s main event for all of the above markets will be on Wednesday. This is when the US Federal Reserve is expected to raise the benchmark bank interest rate for the first time since the Covid-19 pandemic. The increase is expected to be just a quarter-point hike, but investors will also be wondering if the Federal Reserve has revealed a series of rate hikes for the rest of the year.
During a panel discussion on March 11, Ted Oakley, Managing Partner of Oxbow Advisors, He said A 25 basis point increase is expected this Wednesday.
“I want to look at what we might see happen with the Fed. Obviously, next week, we expect a 25 basis point increase there,” Oakley said. “A lot of the concern we’ve seen that the markets are still so unstable about what the Fed might do next. How do you plan around this? How do you position your portfolio when you’re not really sure how aggressive the Fed will be?”
Federal Watch tool predicts 25 basis point increase, report shows futures markets forecast ‘aggressive’ series of price increases
CME’s Federal Reserve Monitoring Tool It also expects the US central bank to raise interest rates by 0.25 percentage point. Bloomberg Transfer Sunday released more details that after raising interest rates for the first time, the Fed may become more “aggressive.”
“Futures markets are showing about 165 basis points to tighten this year, or at least six quarter-point increases,” Bloomberg’s Craig Torres and Olivia Rockman explain. At the House Financial Services Committee meeting on Tuesday, Mark Zandi, chief economist at Moody’s Analytics He said He thinks it’s a good idea to move forward with normalization rates. Zandi said at the meeting:
To ensure that the economy continues to expand and avoids a recession, I believe it is important to normalize interest rates.
Crypto Market Still Without Luster, Gold Hanging 3.49%, Easing Tactics To Finish
On Sunday afternoon, the price of one ounce of gold fell from the high of $2,060 last week. An ounce of gold is currently being exchanged for 1980 dollars an ounce Of pure gold .999. At the time of writing, the global cryptocurrency market cap was hovering around $1.78 trillion, down 2.6% over the past 24 hours.
crypto markets It remains flat with a few tokens collecting single-digit wins on Sunday. Cryptocurrency proponents will be watching the Federal Reserve’s move on Wednesday to see if it negatively impacts the crypto markets. as much as most Reports Concerned, there is not much chance that the central bank will not raise the federal funds rate this month.
Just like the futures markets and the Fed Watch of the Chicago Mercantile Exchange, most analysts and economists agree that the monetary easing tactics of Federal Reserve Chairman Jerome Powell and the US central bank are coming to an end.
“[Jerome] Powell can’t really be pacifist at this point, it would be inconsistent with what sound politics and where politics should be headed,” Derek Tang, economist at Monetary Policy Analytics in Washington He said on Sunday.
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