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Wall Street registers a strong fall and European stock markets close in the red after Central Bank announcements about inflation

Wall Street registers a strong fall and European stock markets close in the red after Central Bank announcements about inflation

Traders at work at the London Stock Exchange (REUTERS/Simon Dawson/File)
Traders at work at the London Stock Exchange (REUTERS/Simon Dawson/File)

European equity markets are trading lower this Fridayand tech stocks fell, after the US Federal Reserve made another big interest rate hike and signaled a further increase in its fight against persistent inflation.

At the same time, The pound sterling falls 1.5% to 1.10 per dollar, with the euro trading below 0.98 cents against the US currency, in both cases marked historic lows.

I Wall Streetthe opening is also negative, with -1.38% in the Nasdaq and S&P 500 indices, and the Dow Jones declares that it is falling below 30,000 points with a red of -1.2% in the first minutes of trading on the New York platform.

The dollar strengthens against the pound sterling (REUTERS/Dado Ruvic/Illustrations/File)
The dollar strengthens against the pound sterling (REUTERS/Dado Ruvic/Illustrations/File)

The Pan-European Index STOXX 600 fell 2.20% at 12:30 GMT, and Germany DAX lost 2.15%. Interest rate sensitive European technology stocks fell about 2.5%.

Meanwhile, the prices Petroleum fall this Friday, with WTI below $80 a barrel for the first time since January, in the context of fears of a global recession. Around 13:10 GMT, The barrel of US West Texas Intermediate (WTI) for delivery in November fell 4.35%up to $79.85.

Brent North Sea for delivery in the same month fell 3.68% to $87.15.

“The threat of a global recession continues to weigh on oil prices and the widespread tightening of monetary policies over the past two days creates fears of a heavy blow to growth,” he said. Craig ErlamOanda analysts.

The Federal Reserve raised interest rates on Wednesday by 75 basis points for the third time in a row. and its interest rate target is seen at its highest level since 2008, rising to the 4.25%-4.50% range later this year.

Isabel Schnabelmember of the Board of Directors of the European Central Bank, said that interest rates they should keep going upbecause inflation is still too high, even as the eurozone faces an economic downturn.

the london index FTSE 100 fell 1.9%, the Eurostoxx 50, which includes the 50 largest companies in the eurozone, fell 2.10%; the CAC 40 on the Paris Stock Exchange lost 1.87%; and the IBEX 35of the Spanish stock market, fell 2.32%.

The Federal Reserve Building in Washington (REUTERS/Leah Millis/File)
The Federal Reserve Building in Washington (REUTERS/Leah Millis/File)

The decision of the Federal Reserve

After a two-day meeting, members of the Fed’s Federal Open Market Committee made the decision to raise interest rateswhich was justified by the president of the Reserve, that is. Jerome Powellat a press conference.

The economist said that central bank authorities “firmly resolved” reducing inflation from the highest levels in four decades and “they will continue doing it until the work is done“.

Powell confirmed that agency officials see a need to raise the reference rate to “restrictive level” and “keep it there for a while”. “We are committed to returning inflation to 2%,” he said.

In that sense, he emphasized that the prospects there are called “landing suave” the economy would likely collapse if central bank officials decided further tightening of monetary policy was necessary. restrictive or restrictive for longer.

In this regard, he noted that “very challenging” and that his colleagues are not sure whether the process of tightening monetary policy will lead to a recession or how deep any contraction might be.

Powell had already hoped last July, when he announced the previous hike, that there might be another one in September “increase unusually large” of the boys, a prophecy he is reiterating in his latest public speeches.

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