The Federal Reserve’s first rate increase since July 2023 is pushing the dollar higher, tightening Asian currencies and lifting bond yields worldwide.
Posts tagged as “Federal Reserve”
The Federal Reserve is expected to lift its benchmark rate by a quarter point on Sept. 16, the first hike since July 2023, as stubborn inflation and high energy costs linger.
The 10-year Treasury yield rose to 5.025%, its highest level since 2007, as markets price a more than 92% chance of a Fed rate hike amid stubborn inflation and firm oil prices.
President Trump and senior officials have intensified public pressure on the Federal Reserve to keep rates low as a September meeting looms, threatening trade actions and urging cuts.
A surprise drop of 23,000 jobs and revised hiring figures pushed the market’s view of a September rate hike to a 56% chance of a hold, while economists remain divided on future moves.
The U.S. dollar traded near a two-week low as investors scaled back expectations of a Federal Reserve rate hike this year. The Japanese yen remained a focus, near a 40-year low.
U.S. stock futures turned negative on Thursday, erasing earlier gains as investors anticipated the release of the June jobs report. The market also reacted to a significant drop in the semiconductor sector.
Asian stock markets mostly declined as concerns over the Middle East peace process led to a rise in oil prices and bond yields, increasing the likelihood of higher U.S. interest rates.
U.S. equity futures declined early Monday as investors assessed progress in Iran negotiations and awaited key inflation data. Oil prices also reacted to the news.
New Federal Reserve Chair Kevin Warsh is reducing the central bank's communication, including "forward guidance" on interest rates, a move analysts warn could increase market volatility and potentially lead to higher borrowing costs.