Dallas Fed President Lorie Logan said Thursday that current data does not support a pause in interest rate hikes yet, leading market expectations for a Fed hike in June to increase again. The implied probability of a fresh rate rise by the Federal Reserve in June is close to 40% now, up significantly from the 10% chance a week ago, the CME Group Fedwatch tool shows.
The U.S. dollar has risen to its highest level in more than five weeks, with the U.S. Dollar DXY index breaking above the 50-day moving average resistance level, indicating a revival in investors' demand for safe-haven assets while debt limit talks continue.
The US stock market climbed on Wednesday, after a productive meeting between Joe Biden and other key congressional leaders a day earlier over raising the debt limit, with the President asserting that the US will never default on its debt. Cyclical sectors such as financials and energy outperformed, the dollar strengthened, and Treasury yields rose across all maturities.
Although gold remains the top choice as a safe haven in case the U.S. hits the debt ceiling and Treasuries take the second spot, Bitcoin seems to have snatched the third spot from popular assets like the U.S. dollar, Swiss franc or the Japanese yen, a survey reportedly shows.
The latest FX & Rates Survey from Bank of America reveals that bond investors are hunting for long-dated Treasuries, put options on the stock market, and long positions in the Japanese Yen versus high-beta currencies to shield themselves from the dangers connected with the U.S. debt limit crisis.
Risk aversion prevailed on Friday, with stock trending lower, Treasury yields climbing and the US dollar being the notable gainer for the session. The preliminary estimate of the University of Michigan consumer sentiment gauge saw a sharp drop in May, down from 63.5 in April to 57, well below the expected 63, with long-term inflation expectations surging to the highest since April 2011.
Market risk appetite soared on Wednesday, with the U.S. dollar plunging while gold, stocks, and bonds rallied after the latest inflation report for April boosted the odds that the Fed will keep interest rates unchanged in June.
Get the latest on Birch Gold Group here. Political and economic developments have seemingly threatened the overall stability of the U.S. financial system. In the former, a European power struggle between Russia and Ukraine and rising tensions between China and Taiwan have left many citizens with fears of a third World War.
Xapo Bank, a private bank offering both traditional banking and access to Bitcoin and stablecoins, said Tuesday that it's the world's first bank to integrate Tether payment rails. What Happened: The phased rollout will be available to all members by the end of the month, adding to the existing USD Coin rails launched in March.
The U.S. economy continues to show robust gains in the job market, with nonfarm payrolls increasing to 253,000 more than projected in April and the unemployment rate reverting to a 50-year low of 3.4%, allaying worries of an impending economic recession. Wage increases also came in higher than expected, with the average hourly gains rising 0.5% versus 0.3% monthly.
News, commentary and research reports are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.
PDF’s require Adobe® Reader® and will open in a new window.
Log In Required
Line of Credit Log In Required