The global actions They went up and the global dollar fell on Monday after global stocks enjoyed their best week in nine months on expectations that the U.S. economy will avoid a recession and cooling inflation will start a cycle of rate cuts. interest rates.
The prospect of lower borrowing costs caused the gold remained near historic highs and the dollar fell against the euro, while the yen experienced a sudden rise that weighed on the Nikkei. MSCI’s broadest index of world shares had risen about 0.2%.
In the United States, members of the Federal Reserve (Fed), Mary Daly and Austan Goolsbee, were over the weekend pointing out the possibility of a Flexibility in September, while the minutes of the latest monetary policy meeting to be published this week should underline the dovish outlook.
Meanwhile, European stocks generally opened unchanged on Monday, while the blue-chip index FTSE 100fell 0.3% and the German index DAXfell 0.2% in early morning trading. Meanwhile, investors are awaiting preliminary data from the purchasing managers’ index (PMI) France, Germany, United Kingdom and the Eurozone later this week.
Waiting for Powell’s speech
The president of the Federal Reserve, Jerome Powell, The Fed will speak in Jackson Hole on Friday and investors assume he will acknowledge the need for a cut. “All signs point to that happening on Friday. We’ll be watching for any indication that rate cuts are coming. The next question is, how big will those cuts be?” said Paul O’Neill, chief investment officer at the wealth management firm Bentley Reid.
Futures are fully priced for a quarter-point move and imply a 25% chance of 50 basis points, depending heavily on what the next payrolls report shows.
Meanwhile, analysts at Goldman Sachs lowered their expectations of recession in USA to 20% and could reduce them further if the August jobs report, due in September, “looks reasonably good,” a note said Friday.
Global dollar decline
In the currency marketshe dollar global fell 1.0% to 146.12 yen, while the euro firmed at $1.1040, just below last week’s high of $1.1047.
“The general message of the Fed “This week’s forecast will likely reassure market participants looking for confirmation that policy rate cuts are now imminent,” said Jonas Goltermann, deputy chief market economist at Capital Economics. “Therefore, the dollar may well remain under pressure in the short term, although given the extent to which an easing of the Fed“We doubt that the dollar will weaken further,” he added.
A weaker dollar combined with lower bond yields helped the gold to remain around $2,503 an ounce, and close to an all-time high of $2,509.
Source: Ambito
