Gold and silver rose in the hours after the Fed’s decision to keep interest rates stable; tensions in the Middle East also contributed to their gains.
Gold and silver rose in the hours after the Fed’s decision to keep interest rates stable; tensions in the Middle East also contributed to their gains.
The PCE is a preferred measure of the Fed as it works to bring inflation down to its target rate of 2 percent.
In its decision, the committee said it seeks greater confidence that inflation is moving sustainably towards its target, and will continue to evaluate “incoming data as they become available, the evolution of the outlook and the balance of risks.”
He reiterated that the economic outlook remains uncertain and said he will continue to monitor economic indicators and labor market conditions. Analysts widely expected the central bank to leave rates unchanged at this meeting, with economists forecasting the first cut would come during its next meeting in September.
“We expect rate cuts in the second half of this year to support business-to-business demand, with manufacturing and industrial activity set to benefit in 2025 and 2026,” ITR Economics economist Lauren Saidel-Baker said.
Saidel-Baker also told Investing News Network that with only two jobs reports before the September meeting, it would be a significant surprise to dissuade the Fed from making cuts.
Markets rallied ahead of the Fed’s release, with the Nasdaq- 100 (INDEXES NASDAQ: NDX) and the S&P 500 (INDEXES ESP:.INX) leading with gains of 3.25 percent and 1.7 percent after a strong earnings report from AMD (NASDAQ:AMD) propelled chipmakers and the tech sector higher. The Dow Jones Industrial Average (INDEXDJX:.1) was up just under 1 percent.
Gold and silver prices also rose in morning trading, driven by rising tensions in the Middle East following the Israeli assassinations of the leaders of Hezbollah and Hamas in Lebanon and Iran respectively; both precious metals soared further once the Fed meeting was completed.
