The minutes of the Federal Reserve’s meeting held on December 14-15 demonstrate that even if the central bank is determined to unravel monetary stimulus (QE) techniques and believes that ultra-low rates of interest are no longer important. World markets fell shortly just after the news was released, with bank stocks stirred up, cryptocurrency markets losing billions, and valuable commodities like gold losing a fraction of their value.
The US Federal Reserve Policy Meeting Suggests QE and Low-Interest Rates Fiesta is nearing its end, and global markets are losing billions of dollars.
According to recently disclosed minutes from the Fed conference last month, the US central bank believes the economy is booming just to unravel massive asset acquisitions and raise the key interest rate. Vishnu Varathan of Mizuho Bank cited as saying that the Fed’s minutes release “bludgeoned the markets” after it was issued. According to Randall W. Forsyth, an economic writer at Barron’s, investors being “surprised, is fairly surprising.”
Stock prices and cryptocurrencies exchanges have lost significant value in the recent 24 hours. During the early market hours on January 6, 2022, the Nasdaq and NYSE both recovered somewhat. Rates in this snapshot were taken at 11:40 a.m. (EST).
Fed Chair Jerome Powell provided no clues on when the rate rise will start, and then when it relates to QE, Powell stated that it is “better to take a prudent, systematic approach.” Powell reiterated that the cautious approach to tapering is due to the fact that “markets can be sensitive.” Stock markets were volatile on January 5 following the release of the Fed minutes, and the cryptocurrency lost billions of dollars. Gold lost 1% and silver lost 3% in value in the 24 hours following the release of the Fed minutes.
Following Wall Street’s drop, Asian markets tumbled throughout the nighttime (EST) market hours as well.
On Thursday, Wall Street’s major indexes gained some ground, with the Nasdaq and NYSE up a few basis points in the mornings, but the Dow Jones index remained down 100 points. Global virtual currency stocks are closed 8.3 percent, with the crypto industry now valued at $2.17 trillion.
According to the minutes of the most recent Fed meeting, the rate of high inflation has risen significantly, but the economy’s strength is regarded as strong. Fed members expressed a desire to “begin to reduce the size of the Federal Reserve’s balance sheet reasonably soon after commencing to raise the federal funds rate.” The next Federal Reserve meeting in the United States is scheduled for January 25-26.