The Fed shook the markets The latest on gold, dollar and Bitcoin
The US Federal Reserve (Fed) raised interest rates by 75 basis points. Gold, stocks and cryptos rose as markets bought Fed Chairman Jerome Powell‘s remarks that it would be appropriate to slow rate hikes at some point.
In its statement, the Fed warned that recent economic data pointed to slowing economic growth. While the bank raised the policy rate by 75 points, interest rates rose from 1.50-1.75 percent to 2.25-2.50 percent. Markets were also expecting a 75 basis point increase.
Fed Chair Powell signaled in his press conference that he is determined to bring inflation under control. Explaining his expectations for the size of the next rate hike, Powell said that ‘at some point it would be appropriate to slow down interest rate hikes’.
The dollar fell to a three-week low against the euro and yen as Fed Chairman Powell allayed concerns that aggressive policy would continue.
The dollar index, which measures the dollar against six major currencies, remained flat at 106.28 after falling 0.6 percent in trading after the session close yesterday.
With the increase in risk appetite, the Nasdaq 100 index gained 4.2 percent. The S&P 500 index, which lists the leading shares of the US stock markets, completed the day with a gain of 2.6 percent.
The Dow Jones index, on the other hand, gained 1.37 percent over 400 points. Borsa Istanbul BIST100 index, on the other hand, was traded at the level of 2 thousand 570, with a premium of more than 1 percent in the morning hours.
Oil also gained value as Powell’s statements partially allayed demand concerns. In addition, the shrinking global crude oil supply and the recovery in gasoline demand in the US also raised prices.
Brent crude oil futures for September rose 1 percent to $107 a barrel today after climbing $2.22 yesterday. US light crude oil rose 1.5 percent to $ 98.7 today, after rising $ 2.28 yesterday.
Gold increased its gains by finding support from the falling dollar and bond yields as Fed Chairman Powell took a less aggressive stance than expected yesterday.
Ounce gold, which was at $ 1720 before the Fed decision, rose to $ 1740 with a daily increase of 0.25 percent after Powell’s statement. Gram gold moved at 1000 TL levels.
Euro/Dollar parity, which was at 1.01 before the Fed decision, rose to 1.02 after Fed Chairman Powell’s statement. Euro also increased its value against TL and reached 18.36.
Bitcoin, which was $ 21,600 before the statement, rallied after the market bought Powell’s words. Bitcoin rose to 22,300 levels with a 9.3 percent premium. Ethereum rose to 1648 levels with a 13 percent premium.