All articles tagged with #fed interest rates
US job growth for the year through March is expected to be revised downward significantly, indicating a weaker labor market than previously thought and increasing pressure on the Federal Reserve to cut interest rates. The revisions, which are routine but politically sensitive, suggest that the economy was slowing before the current administration, and could influence future monetary policy decisions.
U.S. unemployment claims rose to a two-month high of 335,000 due to seasonal adjustments, but actual new claims remain very low, indicating a stable labor market for those employed. However, the number of people collecting unemployment benefits increased, suggesting difficulty for job seekers. Economists believe hiring will remain sluggish until trade tensions ease and interest rates are potentially cut by the Fed, which has caused a decline in stock markets.
Bitcoin and other cryptocurrencies have experienced a sharp decline, with Bitcoin dropping from an all-time high of $124,000 to around $113,000, amid fears of a market crash and upcoming Federal Reserve policy decisions. The broader crypto market has lost over $250 billion in value, influenced by concerns over stablecoin regulations, potential liquidity outflows, and macroeconomic factors such as Fed interest rate cuts. Traders are closely watching the Jackson Hole symposium for signals on future monetary policy that could impact crypto prices.
President Trump criticized Federal Reserve Chair Jerome Powell for keeping interest rates unchanged, calling him 'a real dummy' and claiming his policies will harm the US economy, while Powell justified the decision citing persistent inflation above the Fed's 2% target and the impact of tariffs. Trump has a history of nominating Powell and is expected to announce a successor soon.
Economist David Rosenberg predicts a 30% upside for gold prices, forecasting a potential rise to $3,000 per ounce as the Fed cuts interest rates. The current rally in gold is defying typical macroeconomic challenges and is driven by strong demand from central banks, emerging markets, and rising industrial usage. Geopolitical risks and uncertainties in the global economy are also contributing to the surge. Rosenberg anticipates further upside for gold as central banks begin to cut rates, with a potential 30% increase in play, and advises investors to consider overweighting gold in their portfolios.
Asian stocks opened cautiously on Monday as US earnings season gets into full swing, while a raft of Chinese data will offer insight into how the world's second-largest economy is recovering. Markets have also seen a mood shift on the outlook for US interest rates, with futures implying an 80% chance the Federal Reserve will hike by a quarter point to 5.0-5.25% in May.