Yellen, the Fed Chair told the House Financial Services Committee that the economy is “performing well”. Although the jobs numbers are still soft, the market has been rebounding this past month. But by delaying interest-rate hikes for months, the Federal Reserve has created uncertainty that gives businesses an excuse not to invest in capital projects, Malpasssaid.
A day after Federal Reserve Chair Janet Yellen referred to December as a “live possibility” for a US rate hike, investors were waiting for Friday’s key monthly nonfarm payrolls report to gauge if the data is strong enough to prompt a liftoff.
While persistently low inflation has been a major obstacle for the Fed, Yellen called the issue a transitory factor that would dissipate over time.
“Today’s sell-off was easily definable by a few hawkish comments out of [Yellen] suggestive of a rate hike next month”, Jim Ritterbusch, of the oil-trading firm Ritterbusch & Associates, wrote in a note. Goto added that a number above 165,000-170,00 along with a tick up in wages would prompt the Fed to start hiking rates in December.
Money-market pricing showed a greater than 50-per cent chance of a rate rise next month and the dollar index, which tracks the greenback against six major currencies, rose 0.15 per cent to 98.135, after an 0.8 per cent jump on Wednesday.
With another GOP debate scheduled next Tuesday, the question of whether the Fed boosts rates at its final meeting before the 2016 election year could continue to serve as a political football despite the Feds status as an independent agency.
Gold fell for the seventh straight session, dipping as low as $1,105.2 an ounce, its weakest since October 2, as investors bet on a December USA rate hike. Many analysts have taken that to mean that a rate hike is looming in December.
As Taiwan and South Korea are fierce competitors in the global market, the won’s movement is usually watched closely by the local central bank, which has been eager to keep the Taiwan dollar cheaper in a bid to protect Taiwanese exporters, dealers said. Of course, the Fed has held the prime rate at 0% since this latest economic downturn in 2008.
The spot price hit a five week low Thursday as exchange traded funds saw more outflows.
“The main driver behind the drop in prices must be the speeches of the Fed officials, driving the dollar higher and weighing on the wider commodity space”, said analyst Daniel Briesemann at Commerzbank in Frankfurt.
Japan’s Nikkei 225 climbed 189.5 points, or 1%, to close at 19,116.4 and Hong Kong’s Hang Seng index stayed essentially flat, losing 2.53 points to close at 23.051.
Source: http://rapidnewsnetwork.com/interest-rate-hike-possible/268759/
