Jerome Powell is Federal Reserve Chairman. He dismissed speculation about rates of adverse interest. After it, stock markets broadly weakened. Thus, on Thursday, the United States dollar weakened towards a three- week high.
Meanwhile, the markets of European stock were down more than 1%. Futures of the United States stock indicated a negative beginning for Wall Street. It is pointing to a third consecutive session of losses. Thus, it sends investors to the relative safety of the United States dollar.
The United States President Donald Trump’s comments lifted the dollar. He said that he was supporting a strong dollar. On the same day, Jerome Powell rejected the idea of using negative interest rates.
Nevertheless, Powell is the latest in a policymakers’ parade that brushes off the notion that rates might enter negative territory. By March next year, futures of Federal Reserve were pricing a small chance of sub-zero United States rates.
Dollar
Powell said that the recovery could take some time. It is because he warned of a recession worse than any since of World War Two.
Raffi Boyadjian is a senior investment analyst at XM. He said that to the optimism that had been building in the markets over the last few weeks, Powell’s words were a blow. It is because of the relaxation for the restrictions of social restrictions had generated expectations of a V-shaped recovery from the virus crisis.
The United States dollar edged 0.2% higher to 100.37 against a basket of its rivals. It is hovering below a three-week high of 100.44 hits earlier this week.
The chairman of the Federal Reserve urged more fiscal stimulus for supporting the economy. Mark Haefele is the chief investment officer at UBS Global Wealth Management. He said that ongoing tensions between Democrats and Republicans suggest additional stimulus. Nevertheless, it is unlikely to materialize immediately.
It is the leading news of the market.
