The Federal Reserve took a more hawkish tilt than had been expected in yesterday’s statement, sending stocks and other risky assets lower.
New Zealand’s CPI (inflation) data exceeded expectations, coming in slightly higher than expected, showing a quarterly increase of 1.4% compared to the 1.3% which had been expected. Annualized inflation stands at 5.9%, its highest level in 32 years.
In the Forex market, markets are clearly trading in risk-off mode following the FOMC release. The Fed’s more hawkish stance has boosted the US dollar, which along with the Japanese yen is now the strongest major currency, while the New Zealand dollar is the weakest. This trend may last some time as there are no data releases close which are likely to reverse the risk-off market sentiment.
The yen is a popular asset during turbulent times.
Major cryptocurrencies are selling off, but not very strongly. Bitcoin and Ethereum are again trading below recent pivotal levels. This suggests short trades in crypto are more attractive than longs in the near future.
In the commodities markets, WTI Crude Oil is taking a dip, but several agricultural commodities such as corn, soybeans, and cotton remain bullish.
Daily new coronavirus cases soared to a new global record at the end of last week, with more than 3.7 million new cases recorded for the first time.
Data suggests that the globally rampant omicron coronavirus variant, while considerably more infectious, has notably milder effects than previous coronavirus strains, with an estimated 70% reduction in the probability of hospitalization. This is potentially very good news for both health and economy. Pfizer have announced they plan to have an omicron-specific vaccine ready in March.
It is estimated that 60.7% of the world’s population has received at least one dose of a coronavirus vaccination.
Total confirmed new coronavirus cases worldwide stand at over 363.2 million with an average case fatality rate of 1.55%.
The rate of new coronavirus infections appears to now be increasing most quickly in Algeria, Andorra, Armenia, Austria, Bahrain, Bangladesh, Barbados, Belarus, Belgium, Belize, Bhutan, Brazil, Bulgaria, Chile, Croatia, Cuba, Czech Republic, Denmark, Egypt, Estonia, France, Georgia, Germany, Guatemala, Hungary, Iraq, Israel, Japan, Jordan, Kazakhstan, South Korea, Kosovo, Kuwait, Latvia, Liechtenstein, Lithuania, Luxembourg, Mexico, Moldova, Mongolia, Nepal, Netherlands, North Macedonia, Norway, Oman, Pakistan, Paraguay, Peru, Poland, Portugal, Romania, Russia, Serbia, Singapore, Slovakia, Slovenia, Sweden, Switzerland, Thailand, Trinidad, the UAE, Ukraine, and Uruguay.
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