US markets came under pressure overnight after the FOMC left rates unchanged but signalled a more hawkish tone, with nine committee members still expecting at least one rate hike before year-end. Treasury yields jumped and the dollar rallied strongly, dragging the Dow Jones, S&P 500 and Nasdaq all lower, while gold was among the weakest performers as the stronger dollar weighed on precious metals.
📊 Equities
Equity markets reacted negatively to the shift in the Federal Reserve’s policy outlook after the FOMC left interest rates unchanged but quarterly projections revealed a more hawkish tone, with nine committee members still expecting at least one rate hike before the end of the year. The Dow Jones fell 0.98% to 51,492, the S&P 500 lost 1.21% to close at 7,420, and technology stocks underperformed once again, dragging the Nasdaq 1.34% lower to 26,021.
🛢️ Oil
Energy markets experienced a relatively quiet session, with oil prices edging lower ahead of the expected full reopening of the Strait of Hormuz.
🥇 Gold
Gold was one of the weakest performers on the day as the stronger US dollar weighed on precious metals.
💵 FX & Bonds
The prospect of higher rates saw US Treasury yields jump sharply and the US dollar rally strongly against the major currencies. The US Dollar Index surged 0.84% to 100.38. The two-year Treasury yield climbed 13.4 basis points to 4.185%, while the benchmark ten-year yield added 4.8 basis points to 4.487%.
📌 Today’s Focus
Attention now turns to another busy day for central banks, with interest rate decisions due from both the Swiss National Bank and the Bank of England.
🔹 UK Claimant Count Data
🔹 UK Unemployment Rate
🔹 Swiss National Bank Interest Rate Decision
🔹 Bank of England Interest Rate Decision
🔹 US Weekly Unemployment Claims