On March 20, 2024, in the trading floor of the New York Stock Exchange (NYSE) in New York City, the United States, a trader displayed the Federal Reserve interest rate announcement on the screen.
Brendan McDermid | Reuters
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What you need to know today
Gold’s rally isn’t over yet
Gold prices have been surging and could rise further as central banks continue to buy gold. Prices could reach $2,300 an ounce later this year, especially with the Federal Reserve expected to cut interest rates in 2024, said Aakash Doshi, Citi’s head of North American commodities research.
Congress concerned about U.S. funding to China
In addition to the recent move to essentially ban TikTok, U.S. investments in China have come under increased congressional scrutiny. After an initial false start, some members of the House of Representatives are trying to advance legislation that would cut off the flow of U.S. capital that allegedly funds China’s military development.
Reddit Prices IPO
Reddit priced its IPO at $34 per share, marking the first major social media offering since 2019. The company, which hosts millions of online forums, sold 15.28 million shares, while existing shareholders sold an additional 6.72 million shares.according to a Press releaseThe offering raised $519 million, valuing the company at nearly $6.5 billion.
(PRO) Diet Pills
Von Tobel said a new class of weight-loss drugs could hit Swiss companies with more food categories. The investment bank estimates that demand for these drugs will grow in the coming years despite their high costs. “Thus, the most affected categories are snacks/candy, ‘fast food,'” the analysts said.
bottom line
Wall Street is pleased with what the Fed is saying — and the Fed will stick to it Interest rates have been cut three times this year.
Fed Chairman Jerome Powell and officials haven’t blinked yet and appear willing to cut interest rates as long as inflation makes progress.
The positive signal was reflected in wild swings in the market, with all three major stock indexes surging to new closing highs. Investors breathed a sigh of relief as recent inflation data stoked concerns that rate cuts may be smaller than expected.
Ian Shepherdson, chairman and chief economist at Pantheon Macroeconomics, said in a note: “While the data over the past two months have been disappointing, overall the FOMC maintains that The underlying inflation situation is improving.”
“In other words, they view the latest data as a temporary interruption rather than a change in trend.”
Officials have also significantly revised their GDP growth forecast for this year, now expecting the economy to grow at an annualized rate of 2.1%, up from the 1.4% forecast in December.
Mohamed El-Erian, Chief Economic Advisor of Allianz Group say on X The Fed seems to be showing its immense patience in two ways.
The first is on the timetable to achieve the 2% inflation target, “demonstrating a willingness to tolerate higher inflation for a longer period of time”, on the timetable for achieving the balance sheet size target, and the Fed’s openness to slowing down the degree of quantitative tightening. Attitude proves it. in the coming months, he added.
“The first aspect of patience is consistent with the goal of maintaining economic well-being, while the second aspect reflects the desire to prevent liquidity-related disruptions to market operations,” he explained.
For now, Wall Street appears to have dodged a bullet, and the Fed has no plans to abandon its plan to cut interest rates—at least not yet.
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