By: Nikos Akkizidis
- Wall Street closed negatively on Thursday with investors focusing on macroeconomic data in the US. Wholesale prices rose to record levels in the US in December. The producer price index increased by 0.2% in December compared to November 2021, while compared to December 2020 it recorded a jump of 9.7%. Meanwhile, Patrick Harker, chairman of the Fed Philadelphia, said he would support more than three rate hikes this year if inflation soared. Under these circumstances, the dollar passed below significant support levels, breaking the two-month low.
- Oil prices fell on Thursday, a day after rising to a two-month high but today recovering with investors being optimistic about demand, as the spread of the Omicron variant of the coronavirus shows signs of slowing, while supplies remain tight. Scientists are seeing signs that the Omicron-induced pandemic wave may be nearing its peak. However, demand for refined products continues to decline, keeping oil prices under control.
- Gold closed with losses on Thursday, recording the first fall in 5 sessions. Gold has traditionally been seen as a means of offsetting inflation, but rising prices for goods and services, caused by disruptions in supply chains combined with rising consumer demand in the wake of the coronavirus pandemic, are likely to force US Federal Reserve (Fed) to raise interest rates faster than expected this year in order to tame inflationary pressures and this policy could put pressure on precious metal prices.
- The main Asian stock markets are moving in negative territory, with Japanese and South Korean stocks under the greatest pressure, with the new barrage of comments from Fed officials consolidating expectations that US interest rates could rise even in March. So, as the markets are now preparing for tighter monetary conditions, South Korea’s central bank raised its key interest rate by 25 basis points. to 1.25%, as expected, effectively restoring it to pre-pandemic level in the country’s effort to curb increases in consumer prices.