With the announcement of the details of the Fed Chairman’s report, Wall Street stocks rose
As investors expected the Federal Reserve to maintain its monetary stimulus plan during the pandemic, Wall Street stocks rose, U.S. Treasuries rose, and the U.S. dollar weakened.
The technology-focused Nasdaq Composite Index rose 0.6% in early trading, while the broader S&P 500 index rose 0.5%.
As the price of benchmark government debt instruments rose, the 10-year U.S. Treasury bond yield fell 0.04 percentage points to 1.376%. The U.S. dollar index, which measures the U.S. dollar against major currencies, fell 0.4%.
After the data showed U.S. headlines, Fed Chairman Jay Powell will submit his semi-annual monetary policy report to Congress on Wednesday Consumer price increases Between May and June, it increased by 0.9%, exceeding economists’ forecasts and setting the largest monthly increase since 2008.
Powell in his prepared speech before attending Congress Emphasize He expects that price increases will slow down later this year. He added that changing the $120 billion threshold for monthly debt purchases that central banks used to boost financial markets throughout the pandemic “still has a long way to go.”
Powell will expand his assessment of monetary policy after a survey released by the Bank of America this week found that the proportion of investors who believe the economy will continue to improve A sharp decline From a peak of 91% in March to 47% this month.
Mark McCormick, global head of foreign exchange strategy at TD Securities, said: “We may now see peaks in growth, inflation and stimulus in many countries.” “The market is slowly absorbing this turning point, but as Delta Air Lines [coronavirus] The number of cases is increasing rapidly, and the outlook remains highly uncertain. “
In other respects, after data showed that the country’s inflation rate exceeded the Bank of England’s target, British gold-backed bonds fell, which put pressure on the central bank to reduce its debt purchases.
The 10-year Treasury bond yield rose by 0.02 percentage points to 0.653%. The pound rose 0.6% to $1.388 against the dollar, and the blue-chip FTSE 100 index fell 0.3%.
United Kingdom Consumer price increases Data on Wednesday showed that in the 12 months to June it was 2.5%, and inflation for the third consecutive month was higher than economists expected.
The derivatives market related to the Bank of England’s interest rate movements on Wednesday expects that the UK interest rate will increase to 0.25% by November 2022. Prior to the release of inflation data, this upward adjustment is expected in May 2023.
John Wraith, head of UBS UK interest rate strategy, said that the Bank of England policymakers “will undoubtedly still insist that price pressures will be short-lived”. “But during this period, whether in absolute terms or relative to their own predictions, the higher the interest rate, the more this belief will be undermined.”
The Stoxx Europe 600 Index fell 0.1%. The oil benchmark Brent crude oil stabilized at US$76.48 per barrel.
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