US Interest Rate Position Remains Strong
The US economy is performing much better than expected based on consumer spending data, labor markets, and business activity. The Federal Reserve’s highest interest rate is close to 5.50% – US bond yields and other bonds are rising. Stocks are down dramatically and up.
The MSCI World Index fell 2.7 percent last week, its biggest weekly decline since September, as Asian stocks ex-Japan plummeted for the fourth straight week of losses. The Hang Seng Index fell 17 percent in the previous month, driven by higher interest rates and tighter financial conditions, as well as gains after a 77% jump from a low in October. Bond and dollar yields rose sharply as a result of the Fed’s rethinking of the market. A number of Asian currencies are being pushed back to recent lows, fuelling inflationary pressures across the region and increasing the cost of dollar-denominated debt services.
Investor sentiment is becoming increasingly uncertain as tensions between the United States and China escalate over other issues, including the Russia-Ukraine war. The White House National Security Adviser Jake Sullivan said Sunday that China had not moved toward providing Russia with aid, a decision Washington warned would have “serious consequences.”
Suggestion for investor can sell gold at $1,818.
Set stop-loss at $1,828.
Set take profit at $1,800.
Analyst: Mr. An Rothchanborey, Independent Analyst