The economy and the labor market of United States have recovered to the point that and central bank (Federal Reserve-EDF) could begin reducing its stimulus measures by the end of the year, the institution’s president, Jerome Powell, estimated this Friday. However, the Fed headline did not set a precise timetable.
He stressed instead that there is no rush to raise the benchmark interest rate from its current levels of 0-0.25 percent, andostuvo that the body will not react to inflationary pressures that it considers temporary.
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Immediately the world’s major financial and stock markets reacted to the message sent by Powell in the sense that, despite the impact of the delta variant of the coronavirus, the US economy has continued to recover and show strong employment growth.
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Half an hour after the intervention of the President of the Fed, the main indicator of Wall Street, the Dow Jones Industrial, marked a 0.62 percent rise. The selective S&P 500 it climbed 0.65 percent while the composite market index Nasdaq, Which brings together the most important technologies, was the most encouraged infected by the words of Powell, and advanced 0.78 percent.
The New York public prosecutor’s office had already become optimistic, after Thursday’s cautionary day in which the proximity of Powell’s speech at the bankers’ meeting pushed investors to bet on sales and collect the benefits of the new historical highs marked by the parquet the day before.
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The first to react to Powell’s speech were the Southeast Asian stock markets closed, which recorded mixed results ending a very volatile week marked by the possible withdrawal of stimulus from the stock market. United States Federal Reserve.
in Singapore, The stock market lost 0.92 percent and the index Straits Times ended the session with 3,080.77 units. In Indonesia, Jakarta parquet lost 0.28 percent, and the JCI index finished with 6,041.37 units.
In Malaysia, the Kuala Lumpur Stock Exchange advanced 0.28 percent, and the KLCI selective finished at 1,590.16 units. in Thailand, Bangkok parquet gained 0.58 percent, and the SET index closed with 1,611.20 units. In turn, in the Philippines, the Manila Stock Exchange fell 0.5 percent, while a Vietnam, Ho Chi Minh (formerly Saigon) parquet VN index closed up 0.93 percent.
Bounce to Europe
The message sent this morning by the president of the US central bank was also heard in Europe. European stock markets gained ground reassured by Powell’s moderate speech. London, for example it gained 0.32 percent, Paris did so by 0.24 percent, Frankfurt advanced 0.37 percent, Milan gained 0.56 percent while Madrid climbed 0.33 percent.
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In turn, the euro appreciated to above $ 1.18. the euro it was trading around 15.10 GMT at $ 1.1791, compared to $ 1.1760 in the last hours of the previous day’s European Al market trading.
The European Central Bank (ECB) set the euro benchmark exchange rate at $ 1.1761. Powell indicated in his speech in Jackson Hole, Wyoming, that if the economic recovery continues solidly, it might be “appropriate to begin this year the reduction of monetary stimulus.”
Rising oil
Crude prices were no exception to the mood experienced on Friday in other global markets, and after a brief hiatus, they finished a record week for 2021.
In New York, The barrel of American “light sweet” (WTI) For delivery in October it advanced 1.95 percent to $ 68.74, or $ 1.32 more. On his side, in London, the barrel of Brent of the North Sea for delivery in October ended with a gain of 2.29 percent, to $ 72.70, up $ 1.63 on Thursday’s close.
The two reference contracts on both sides of the Atlantic they rose more than 10 percent during the week, an exercise not seen for nearly a year for the WTI case – in September 2020 – and even more so for Brent, since June of that year.
“Between storm Ida, the fire of a platform in the Gulf of Mexico, the improvement in demand in the United States and Asia, everything coincided for a very positive week,” he told AFP James Williams, of WTRG Economics. He also noted that this change in trend in crude prices this week echoed “the big fall of the previous week.”