Markets calm after massive drops but will this continue
Federal Reserve Chairman Ben Bernanke confirmed his positive outlook on economic growth and indicated that the latest move in stock prices will not alter the Fed’s plans for monetary policy.
Yet real concerns about the US economy still remain. We saw the largest percentage drop in new home sales in 13 years. The significant aspect of this is that the supply of new home sales increased which suggest the worst is yet to come. The Chicargo PMI was also down from an anticipated 50.0 to 47.9.
After yesterday's drop in world markets leaders came out to assure investors and try to calm the massive sell off. Starting with the Chinese government, officials at the Ministry of Finance reassured international investors that they are not planning to take some heat off the economy by enacting a capital gains tax.
Investors felt that tighter restrictions on foreign investment would inhibit potential growth. In the US, members of the NYSE attributed the collapse in the Dow to a computer glitch and not necessarily mass bearish sentiment.
The Euro was hit yesterday predominantly due to the rebound in the dollar despite positive data from the Eurozone. German Unemployment rate dropped from 9.5% to 9.3% and consumer confidence improved in the Eurozone region despite the prospects for another interest rate hike and the increase to Germany’s Value Added Tax.
Sterling was stronger across the board thanks to solid housing market data. The UK’s Nationwide Building Society reported 0.7% rise in house prices in the month of February. The market was looking at a 0.5% rise.
Bank of England Deputy Governor Lomax warned today that inflation could fall sharply in the months ahead and take the rate below the central bank’s target by the end of the year. Consumer confidence did not improve along with it as the GfK report dropped from -7 to -8.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
Yet real concerns about the US economy still remain. We saw the largest percentage drop in new home sales in 13 years. The significant aspect of this is that the supply of new home sales increased which suggest the worst is yet to come. The Chicargo PMI was also down from an anticipated 50.0 to 47.9.
After yesterday's drop in world markets leaders came out to assure investors and try to calm the massive sell off. Starting with the Chinese government, officials at the Ministry of Finance reassured international investors that they are not planning to take some heat off the economy by enacting a capital gains tax.
Investors felt that tighter restrictions on foreign investment would inhibit potential growth. In the US, members of the NYSE attributed the collapse in the Dow to a computer glitch and not necessarily mass bearish sentiment.
The Euro was hit yesterday predominantly due to the rebound in the dollar despite positive data from the Eurozone. German Unemployment rate dropped from 9.5% to 9.3% and consumer confidence improved in the Eurozone region despite the prospects for another interest rate hike and the increase to Germany’s Value Added Tax.
Sterling was stronger across the board thanks to solid housing market data. The UK’s Nationwide Building Society reported 0.7% rise in house prices in the month of February. The market was looking at a 0.5% rise.
Bank of England Deputy Governor Lomax warned today that inflation could fall sharply in the months ahead and take the rate below the central bank’s target by the end of the year. Consumer confidence did not improve along with it as the GfK report dropped from -7 to -8.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
Labels: Bernanke, FED, stock market falls
posted by Drs Search @ 11:20 AM
0 Comments:
Post a Comment
Links to this post:
Create a Link
<< Home