The US Federal Reserve (Fed) raised interest rates by 3 yards as expected on Wednesday (21st) and sent a signal to continue tightening policy, driving the four main US stock indexes to break in late trading, and ended in a blackout, with the Dow Jones falling more than At 500 points, the S&P 500 and the Nasdaq both fell more than 1.7%, and Feihan fell almost 1%.
All four major indexes closed at intraday lows, with the Dow hitting its lowest close since mid-June, and the S&P and Nasdaq closing at their lowest since late June and early July , respectively.
After raising interest rates three times in a row to a range of 3-3.25%, Fed Chairman Powell on Wednesday reiterated his determination to tame inflation, hinting that similar steps could continue in November.
The Fed expects the benchmark interest rate to rise to 4.4% by the end of the year, and it is estimated that the final interest rate will reach 4.6% next year, which is higher than the previous forecast. Given that there are only 2 interest rate meetings. after this year, this means the Fed can raise interest rates another 3 yards before the end of the year. In addition, the interest rate dot plot shows that officials do not expect a rate cut until 2024, and the headline inflation rate is not expected to fall back to the Fed’s 2% target until 2025.
As traders digested the interest rate decision and Powell’s latest comments, US stocks fell sharply in late trading after the intraday shock. Treasury yields rose sharply. The 2-year US Treasury yield rose once to 4.1%, reaching the highest level since 2007. , the 10-year US Treasury yield jumped to 3.6%, and the US dollar index hit a new 24-year high.
As for the international situation, Russian President Vladimir Putin announced on Wednesday that Russia is committed to a “partial military movement” and will make no effort to defend Russian territory. The comments were interpreted by the outside world as a possible use of nuclear weapons, prompting strong condemnation from Western countries.
EU foreign ministers are expected to hold an emergency meeting on Wednesday to discuss whether to impose further sanctions on Russia and supply arms to Ukraine.
Regarding the epidemic, before the deadline, data from Johns Hopkins University in the United States showed that the number of confirmed cases worldwide had reached 613 million, and the number of deaths had exceeded 6.53 million. About 12.3 billion vaccine doses have been administered in 184 countries worldwide.
The performance of the four major US stock indexes on Wednesday (21st):
Figures are updated before the deadline, please refer to the actual quote.