Minutes from the US Federal Reserve's December 14-15 monetary policy meeting show that the central bank remains adamant about abandoning quantitative easing (QE) tactics and no longer believes ultra-low interest rates are necessary. Global markets fell immediately after the news was released as stock markets roiled, crypto markets lost billions and precious metals like gold also fell in value. US Federal Reserve Policy Meeting Suggests QE, Low Rate Fiesta Is Ending, Global Markets Lose Billions Recently released notes from last month's Fed meeting suggest that the US Federal Reserve believes...
Minutes from the US Federal Reserve's December 14-15 monetary policy meeting show that the central bank remains adamant about abandoning quantitative easing (QE) tactics and no longer believes ultra-low interest rates are necessary. Global markets fell immediately after the news was released as stock markets roiled, crypto markets lost billions and precious metals like gold also fell in value.
Recently published notes from last month's Fed meeting suggest that the U.S. central bank believes the economy is healthy enough to undertake major asset purchases and raise interest rates. Vishnu Varathan. from Mizuho Bank wrote in a report that the Fed's minutes update "slammed the markets" upon its release. Barron's financial writer Randall W. Forsyth wrote that investors are "surprised, somewhat surprised."
Fed Chairman Jerome Powell gave no details on when the rate hike will begin, and when it comes to QE, Powell said it was "best to take a cautious, methodical approach." Powell insisted the cautious stance on tapering is because “markets can be sensitive.” Stock markets were sensitive on January 5th after the Fed minutes were released and the Crypto economy also lost billions in value. Gold shed 1% and silver lost 3% in value in the last 24 hours after the Fed minutes were released.
Asian stocks also fell during overnight trading sessions (EST) following Wall Street's plunge. On Thursday, Wall Street's top indexes added some gains as the Nasdaq and NYSE gained a few percentage points in the morning, but the Dow Jones index still lost 100 points. Digital currency markets across the board are down 8.3% as the crypto economy is valued at $2.17 trillion today.
The last meeting of the Fed minutes showed that inflation levels in the US rose sharply, but the strength of the economy was considered healthy. Fed participants wrote that they wanted to “begin reducing the Federal Reserve’s balance sheet relatively soon after the rate hike began.” The Federal Reserve's next meeting is scheduled for March 25-26. January planned.
What do you think of the Federal Reserve's recent minutes report and the market changes that followed shortly thereafter? Let us know your thoughts on this topic in the comments below.
Photo credits: Shutterstock, Pixabay, Wiki Commons, Gold.org, Bitcoin.com, Apple shares,
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