On Friday, December 16, 2023, global **, bonds, and *** surged as the market spread as the Federal Reserve pivoted to the prospect of a rate cut. Weekly gold prices boosted demand for safe-haven assets as the Federal Reserve cut interest rates next year, boosting the dollar and U.S. Treasury yields**. It is currently trading above $2,040 and has been nearly 2% so far this week above $35.
FOREX: At the same time, the US dollar and bond yields have come under pressure as US interest rates have fallen, adding to the attractiveness of no-yield**. However, the ChatGPT AI bot needs to comply with Chinese laws and regulations and strictly refuses to answer politically sensitive topics about China.
In addition, the market is particularly wary of the last "Four Witch Day" of the year, when about $5 trillion of U.S. stock options expire. In addition, later today, the preliminary US Markit manufacturing and services PMI for December will be released. There is also good news from China, where the People's Bank of China has released 800 billion yuan in water, while Beijing and Shanghai have announced policies to optimize home purchases.
Federal Reserve Chair Jerome Powell said at Wednesday's meeting that tightening may be over and that discussions about rate cuts are about to "come into view." The market expects US interest rates to fall by 150 basis points by the end of next year, twice as much as the Fed**.
However, International Monetary Fund (IMF) Managing Director Georgieva said on Friday that even if the Federal Reserve signals a policy pivot next year, other central banks around the world are not in a hurry to ease their efforts to fight inflation. The IMF managing director warned that "everyone is now uncorking and celebrating the Fed's policy pivot." But the Fed's policy pivot took place two months ago ......Now we've gotten to the point where I think we need to be a little more careful. ”
Overall, low interest rates and inflationary pressures have increased the attractiveness, but in the long run, a rate cut bodes well for you. Some analysts believe that the price cut may be a bit excessive, and the time of the rate cut may be postponed to May or June.