The U.S. dollar was gaining this morning on a stronger-than-expected GDP report, rising expectations of a Fed rate hike, and easing concerns about global growth. Second quarter GDP was up 3.9%, well ahead of consensus expectations of 3.7%.
The U.S. dollar saw gains after a critical manufacturing report in China signaled the world’s second-largest economy is slowing down. Today’s insight includes a bounce-back for oil prices, economic concerns Down Under, testimony from European Central Bank head Mario Draghi and the world’s reaction to China’s slowing economic growth.
The U.S. dollar approached two-week highs on Tuesday morning after Atlanta Federal Reserve Bank President Dennis Lockhart said he predicts the U.S. central bank will raise interest rates at the October or December FOMC meeting.
The U.S. dollar made gains this morning as markets anticipate that central banks around the world will ease monetary policy. The anticipation comes in the wake of the Federal Reserve’s decision last week to maintain its current rate level.
The Dow Jones was up 15 points at 11:20 a.m. EST on Thursday as markets and traders cautiously prepare for a policy decision today from the Federal Reserve at 2 p.m. The S&P was flat, while the Nasdaq added a lackluster 9.7 points.
StocksThe stock market volatility remained elevated last week, in part because of the increased worries about the health of the global economy. The much-anticipated U.S.-jobs report failed to inspire a rally either as the unexpectedly sharp drop in the unemployment rate and the stronger-than-expected increase in wage growth kept the prospects of a 2015 Federal Reserve rate rise alive.
Crude oil prices were under pressure after Mario Draghi magic seemed too eased off. Oh, sure, after Mario Draghi said he was disappointed with growth and the lack of inflation, oil got a bounce. Yet, when Asian and European stocks gave up the gains, oil prices falter until a headline came out about those Chinese Military ships that are moving off of the coast of Alaska.
The euro fell 1% on Thursday on a darkening euro zone outlook, while global stock markets rallied as the European Central Bank chief pledged to beef up or prolong the bank's economic stimulus if necessary.