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Business News/ Economy / US Fed Meeting Highlights: Nifty 50, Sensex crash tracking Wall Street losses after hawkish FOMC rate cut outlook
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US Fed Meeting Highlights: Nifty 50, Sensex crash tracking Wall Street losses after hawkish FOMC rate cut outlook

US Fed Meeting Highlights: Wall Street benchmark indices, Dow Jones, S&P, and Nasdaq posted their biggest daily decline in months, while Treasury yields spiked after US Fed chair Jerome Powell-led rate-setting panel flagged a slower pace of interest rate cuts next year.

US Fed Meeting Highlights: Jerome Powell led FOMC delivered its final interest rate decision for 2024 on December 18 after a two-day policy review. (Photo: Bloomberg)Premium
US Fed Meeting Highlights: Jerome Powell led FOMC delivered its final interest rate decision for 2024 on December 18 after a two-day policy review. (Photo: Bloomberg)

US Fed Meeting Highlights: The US Federal Reserve announced its eighth policy decision for 2024 after a two-day Federal Open Market Committee (FOMC) meeting and voted 11 to 1 on Wednesday, December 18, to slash the benchmark interest rate by 25 basis points (bps) or (1/4) quarter of a percentage point to 4.25 - 4.50 per cent, broadly in line with Wall Street estimates.

This is the US Central Bank's third straight policy reduction in 2024 and the second straight 25 bps rate cut. US Fed chair Jerome Powell-led rate-setting panel now envisions only two rate cuts in 2025 after latest US inflation prints revealed that consumer prices still remain ‘somewhat elevated’ in the world's largest economy.

Financial markets globally saw a sharp fall after the hawkish Fed outlook, with all three major Wall Street indices closing up to 3% lower. The Dow Jones and S&P saw their biggest one-day percentage decline since August 5 and the Nasdaq saw its biggest daily decline since July 24, Reuters reported.

The Indian stock market benchmark indices, Sensex and Nifty 50, also crashed more than a percent each on Thursday, following the US Fed rate cut outlook.

19 Dec 2024, 11:41:28 AM IST

US Fed Meeting Highlights: 5 key takeaways from Fed’s December policy

US Fed Meeting Highlights: Here are 5 key takeaways from US Federal Reserve’s December policy

> Interest rates cut by 25 bps to 4.25% - 4.50% range

> Fed to slow down pace of easing, eyes only two rate cuts in 2025

> Inflation, GDP forecasts for 2025 increased

> Rate on RRP tool tweaked, slows down pace of balance-sheet runoff

> Wall Street crashes on rate cut outlook; S&P 500 logs worst Fed day since 2001, Dow logs longest losing streak since 1974

19 Dec 2024, 11:11:44 AM IST

US Fed Meeting LIVE: RBI February repo rate cut call gets trickier: Madhavi Arora

US Fed Meeting LIVE: US Fed meeting marked a shift toward hawkishness, with the Fed's outlook moving closer to our 'higher-for-really-long' scenario. There is a strong chance of a pause ahead – Fed Funds Futures are pricing in ~91% probability of a 'hold' at the January meeting. With policy and macro uncertainty around, it is no surprise that the Fed has chosen to signal a cautious approach going forward – akin to driving slowly on a foggy night, said Madhavi Arora, Lead – Economist at Emkay Global Financial Services Ltd.

As for the RBI, a new MPC in 2025 will be facing substantially different policy challenges along with a diverse macro and global landscape. The policy trade-offs are getting acute due to the entrenched state of India's stagflation, tricky timings and small window of conventional rate cuts as global dynamics turn more fluid, and mounting FX pressure and increasing cost of FX intervention.

Conventional rate-cut window is only going to get tight. February cut call gets trickier from hereon. The spillover of bond/FX volatility via the global financial markets route could also mean the aim of financial stability may even precede inflation management for the RBI ahead, Arora said.

19 Dec 2024, 10:48:14 AM IST

US Fed Meeting LIVE: Potential for reduced foreign capital inflows a concern, says Subho Moulik of Appreciate

US Fed Meeting LIVE: The Fed’s hawkish stance of reducing the number of rate cuts from previously-anticipated four times to twice next year due to low unemployment rate and sticky inflation may put investors on edge. The Fed’s stricter stance will not be music to the ears of Indian equity investors. The potential for reduced foreign capital inflows is a concern, as the US debt market, with its more attractive returns, becomes a stronger alternative. This triggers the likelihood of a near-term pullback in the market, said Subho Moulik, founder & CEO, Appreciate.

In times of market uncertainty, large-cap stocks are often seen as a safe bet. However, with foreign institutional investors (FIIs) typically invested more in the larger Indian companies, these stocks may not be entirely insulated from potential outflows. As such, investors may need to consider sector-specific strategies. Export-oriented sectors, such as IT and pharmaceuticals, can be pockets of strength. They could provide a greater margin of safety during this time, he added.

As for mid and small caps, they are already at somewhat elevated valuation levels. Identifying the right companies will require a lot of precision, as they are the most prone to market corrections. That said, the blip is not a structural one. The India growth story is a long-term play. The market will eventually catch its breath, offering savvy investors a chance to buy quality companies on the dip, Moulik said.

19 Dec 2024, 09:53:03 AM IST

US Fed Meeting LIVE: Currency, commodity market volatility likely to remain high, says Jigar Trivedi of Reliance Securities

US Fed Meeting LIVE: The strength of the dollar and the upward trajectory of U.S. Treasury yields are creating headwinds for commodities, particularly precious metals. Gold, for instance, has been under significant pressure, recently dipping near $2,600 per ounce. Silver is also feeling the strain, trading at $29.45 per ounce. As we move into 2025 and beyond, market volatility is set to continue, driven by potential trade disruptions and fiscal uncertainties, particularly under the incoming administration, said Jigar Trivedi, Senior Research Analyst - Currencies & Commodities, Reliance Securities.

The outlook for the dollar and commodities will largely depend on the Fed’s ability to manage inflation and the global economic impact of U.S. fiscal and trade policies. Given these dynamics, both currency and commodity markets are likely to remain highly sensitive to changes in monetary policy and fiscal developments over the next few years, he added.

19 Dec 2024, 09:37:32 AM IST

US Fed Meeting LIVE: Rupee weakens past 85 per USD after hawkish Fed outlook 

US Fed Meeting LIVE: The Indian rupee weakened past 85 to the US dollar for the first time on Thursday after hawkish Federal Reserve’s future rate projections. The rupee hit a low of 85.0650 in early trading, down 0.1% from its close at 84.9525 in the previous session. The dollar and U.S. Treasury yields climbed after the Fed cut rates by 25 basis points on Wednesday, but its Summary of Economic Projections showed two rate cuts in 2025, down from four in September.

19 Dec 2024, 09:20:39 AM IST

US Fed Meeting LIVE: Sensex, Nifty 50 crash following hawkish US Fed outlook

US Fed Meeting LIVE: Indian stock market benchmark indices opened sharply lower after the hawkish rate cut by the US Federal Reserve. The Sensex crashed 1,153.17 points, or 1.44%, to open at 79,029.03, while the NIfty 50 opened at 23,877.15, down 321.70 points, or 1.33%.

19 Dec 2024, 09:06:40 AM IST

US Fed Meeting LIVE: Gold prices recover from one-month low 

US Fed Meeting LIVE: Gold prices jumped more than 1% on Thursday on short-covering after dipping to the lowest in a month earlier in the session, while the market awaited key U.S. data for further cues on the Federal Reserve's policy trajectory. Spot gold gained 0.8% to $2,607.88 per ounce, while U.S. gold futures eased 1.2% to $2,620.60.

19 Dec 2024, 08:37:17 AM IST

US Fed Meeting LIVE: Bank of Japan keeps interest rates steady 

US Fed Meeting LIVE: The Bank of Japan kept interest rates steady on Thursday, after the US Fed announced a rate cut overnight.  As widely expected, the BOJ board decided to keep the short-term policy rate unchanged at 0.25% by an 8-1 vote, with board member Naoki Tamura dissenting.

19 Dec 2024, 07:45:54 AM IST

US Fed Meeting LIVE: Asian markets slid after US Fed outlook 

US Fed Meeting LIVE: Asian markets traded lower on Thursday following sharp decline on Wall Street overnight. Japan’s Nikkei 225 fell 1.4% while Topix dropped 1.27% ahead of the Bank of Japan’s monetary policy. South Korea’s Kospi index declined 1.84% and the Kosdaq index plunged 1.92%. Hong Kong’s Hang Seng index futures indicated a mildly higher opening.

19 Dec 2024, 07:28:58 AM IST

US Fed Meeting LIVE: Wall Street crashes as US Fed outlook disappoints

US Fed Meeting LIVE: US stock market ended sharply lower on Wednesday after the Fed cut rates but disappointed with projections that signaled a more cautious path of easing next year.

The Dow Jones Industrial Average plunged 1,123.03 points, or 2.58%, to 42,326.87, while the S&P 500 dropped 178.45 points, or 2.95%, to 5,872.16. The Nasdaq Composite ended 716.37 points, or 3.56%, lower at 19,392.69. The Dow and S&P saw their biggest one-day percentage decline since August 5 and the Nasdaq saw its biggest daily decline since July 24, Reuters reported.

Tesla stock price cracked 8.2%, Amazon shares declined 4.6%, Microsoft stock price fell 3.76%, and Nvidia share price dropped 1.14%. Microstrategy tumbled 9.5%, MARA Holdings plunged 12.2% and Riot Platforms fell 14.5%.

19 Dec 2024, 06:47:07 AM IST

US Fed Meeting LIVE: US Treasury yields spike on Fed rate cut outlook

US Fed Meeting LIVE: US Treasury yields surged after the Fed flagged a slower pace of easing next year. The yield on the benchmark US 10-year note touched its highest level since May 31 at 4.518%. The two-year yield, which more closely tracks expectations for Fed action, climbed to 4.35% from 4.25%.

19 Dec 2024, 06:24:35 AM IST

US Fed Meeting LIVE: Crude oil prices fall as dollar rises on fewer rate cut hopes

US Fed Meeting LIVE: Crude oil prices fell as expectations for fewer interest-rate cuts by the Federal Reserve next year boosted the dollar, Bloomberg reported. West Texas Intermediate for February dropped toward $69 a barrel, while Brent crude closed above $73. Meanwhile, the dollar rallied to its strongest level in more than two years.

19 Dec 2024, 03:28:01 AM IST

US Fed Meeting LIVE: Powell-led FOMC to meet next in January

US Fed Meeting LIVE: US Fed Chair Powell-led FOMC will now meet on January 28-29 to deliberate for the next set of policy decisions.

19 Dec 2024, 03:25:31 AM IST

US Fed Meeting LIVE: Key highlights of Powell-led FOMC decision

US Fed Meeting LIVE: Here are the key highlights from the December policy verdict

-Powell-led FOMC slashes key rates for the third straight time and delivered a 25 bps cut for the second straight meeting

-US Fed envisions fewer rate cuts in 2025 and slower pace of easing over somewhat ‘elevated’ inflation. Two rate cuts eyed in 2025

-Policymakers raised the median forecast for headline inflation in 2025 to 2.5 per cent, up from 2.1 per cent in September.

The US Fed tweaked the rate on a key RRP tool for the first time since 2021. The US central bank on Wednesday said it was continuing to shrink its balance sheet.

-Wall Street rocked after US Fed rate cut outlook. Dow crashed by 1,100 points to log its longest losing streak since 1974; S&P 500, Nasdaq reported worst day in five months.

 

Worth noting: Despite the declines, the Dow is up nearly 12.3 per cent on the year, while the S&P has rallied about 23 per cent and the Nasdaq has shot up more than 29 per cen, lifted largely by technology companies and enthusiasm around artificial intelligence, along with prospects of a lower rate environment and more recently, the hope of deregulation policies from President-elect Donald Trump's incoming administration.

19 Dec 2024, 03:14:09 AM IST

US Fed Meeting LIVE: US Fed rate cut outlook rocks Wall Street; Dow, S&P 500 log worst day in five months

The Dow and S&P saw their biggest one-day percentage decline since August 5 and the Nasdaq saw its biggest daily decline since July 24. The Dow Jones Industrial Average fell 1,123.03 points, or 2.58 per cent, to 42,326.87.

S&P 500 fell below the 6,000 level to lose 178.45 points, or 2.95 per cent, to 5,872.16 and the Nasdaq Composite lost 716.37 points, or 3.56 per cent, to 19,392.69. For the Dow it was its tenth consecutive daily loss, marking its longest losing streak since 1974 and its biggest daily percentage decline since early August.

The small cap Russell 2000 dropped 4.4 per cent, its biggest drop since June 16, 2022. Small cap stocks are seen as more likely to benefit from a lower interest rate environment. Cryptocurrency related stocks fell, with losses accelerating after Powell said the central bank is not allowed to own bitcoin and is not seeking a law change in order to do so.

 

19 Dec 2024, 03:03:49 AM IST

US Fed Meeting LIVE: Gold falls more than 2% after Fed signals rate-cut slowdown in 2025

US Fed Meeting LIVE: Gold slipped more than two per cent to a one-month low on Wednesday after the U.S. Federal Reserve lowered interest rates as expected, but noted it will slow the pace at which borrowing costs fall any further, boosting the dollar and bond yields.

Spot gold was down 2.1 per cent at $2,589.91 per ounce by 03:56 p.m. EST (2056 GMT), its lowest level since November 18. US gold futures settled 0.3 per cent lower at $2,653.30. Elsewhere, spot silver fell 3.5 per cent to $29.45 per ounce, platinum slipped two per cent to $919.25, and palladium declined three per cent to $906.88.

19 Dec 2024, 02:58:54 AM IST

US Fed Meeting LIVE: Wall Street analysts on US Fed policy verdict

US Fed Meeting LIVE: FX Market Analyst Kyle Chapman at Ballinger Group on US Fed verdict:

"The Fed cut to appease markets despite key contradictions, but points to only two next year. The Federal Reserve has cut by 25bps to 4.25-4.50%, but policymakers have revised up growth, inflation, and their expectation for the fed funds rate in 2025.

“The markets were expecting three cuts to be pencilled into the dot plot for next year and instead it was two. There were very few changes to the policy statement, so it is the SEP lifting Treasury yields and the dollar. Powell may say that Trump's potential policy isn't yet being integrated into the models, but that doesn't stop his peers from implicitly including a fiscal inflationary impulse and tariffs in their rate projections. It is that and the recent stall in disinflationary progress that have led to the more hawkish expectations.

“The key contradiction for me here is that everything in the projections - higher growth, higher inflation, lower unemployment - actually all points to the appropriate decision today being a rate pause. Three officials have said as much in the dot plot. So why did they cut? Largely because they hinted that they would, and because the market was pricing in one - not necessarily because the current data justifies it.

“I would caution against taking too much steer from the dot plot. Narratives about inflation and the labour market have swung countless times over the past few years (remember when markets were pricing in three 50bp rate cuts before the end of this year?) and both the market and the Fed were fooled by an inflation head-fake before, back in Q1."

19 Dec 2024, 02:54:51 AM IST

US Fed Meeting LIVE: S&P 500 just shy of most significant losing mark in 2024, Dow crashes over 1,110 points

US Fed Meeting LIVE: The S&P 500 fell 2.9 per cent, just shy of its biggest loss for the year from the summer, to pull further from its all-time high set a couple weeks ago. The Dow Jones Industrial Average lost 1,123 points, or 2.6 per cent, and the Nasdaq composite dropped 3.6 per cent.

Wall Street experts say the bigger question centers on how much more the Fed will cut next year. A lot is riding on it, particularly after expectations for a series of cuts in 2025 helped the US stock market set an all-time high at least 57 times in 2024.

Fed officials released projections on Wednesday showing the median expectation among them is for two more cuts to the federal funds rate in 2025, or half a percentage point’s worth. That’s down from the four cuts expected just three months ago.

The S&P 500 fell 178.45 points to 5,872.16. The Dow Jones Industrial Average dropped 1,123.03 to 42,326.87, and the Nasdaq composite skidded 716.37 to 19,392.69.

In stock markets abroad, London’s FTSE 100 edged up by less than 0.1% after data showed inflation accelerated to 2.6 per cent in November, its highest level in eight months. The Bank of England is also meeting on interest rates this week and will announce its decision on Thursday.

19 Dec 2024, 02:48:57 AM IST

US Fed Meeting LIVE: Canadian dollar hits new low on scramble for downside protection

US Fed Meeting LIVE: The Canadian dollar edged to a multi-year low against its US counterpart on Wednesday as investors awaited a US Federal Reserve interest rate decision and sought protection against additional losses for the currency.

The loonie was trading 0.1 per cent lower at 1.4330 to the US dollar, or 69.78 US cents, after touching its weakest intraday level since the onset of the COVID-19 crisis in March 2020 at 1.4339. Investors and companies use options to hedge their currency exposure. The currency touched a low of 1.4667 in March 2020.

Domestic political uncertainty has added this week to headwinds for the loonie. The currency has also been pressured by the threat of U.S. trade tariffs and a more aggressive interest rate cutting campaign by the Bank of Canada than the US Federal Reserve.

19 Dec 2024, 02:46:18 AM IST

US Fed Meeting LIVE: US stocks fall to their second-worst drop of the year on diminished hopes for 2025 rate cuts

US Fed Meeting LIVE: US stocks fall to their second-worst drop of the year on diminished hopes for 2025 rate cuts. Dow dropped over 1,100 points. Powell reiterated at the press conference that the Fed was committed to reaching its two per cent target.

“We’re not going to settle for that," he said about inflation staying above that goal. Markets are reacting to several Fed officials penciling in fewer rate cuts for next year than they expected a few months ago. Traders are now pricing in less than a half-point of cuts in 2025.

19 Dec 2024, 02:36:53 AM IST

US Fed Meeting LIVE: Wall Street sinks after Fed signals fewer rate cuts next year. Dow drops 1,100

US Fed Meeting LIVE: US stocks sank to their second-worst loss of the year after the US Federal Reserve signalled that it may deliver fewer interest rate cuts in 2025 than earlier thought. The S&P 500 dropped 2.9 per cent on Wednesday, pulling further from its all-time high set a couple of weeks ago. 

The Dow Jones Industrial Average sank more than 1,100 points, and the Nasdaq composite dropped 3.6 per cent. Fed officials released projections showing they’re penciling in just two cuts to interest rates next year, instead of the four they were projecting a few months ago. 

 

19 Dec 2024, 02:30:57 AM IST

US Fed Meeting LIVE: US crude futures turn negative post-Fed verdict

US Fed Meeting LIVE: US crude futures turned negative post-settlement after US Federal Reserve signaled it will slow pace of interest rate cuts in 2025. The FOMC slashed the benchmark rate by 25 bps to 4.25-.4.50% on Wednesday

19 Dec 2024, 02:28:37 AM IST

US Fed Meeting LIVE: US Fed tweaks rate on key RRP tool for first time since 2021

US Fed Meeting LIVE: The Federal Reserve, in addition to its main interest-rate cut, lowered the rate on a facility used to help control its benchmark as it aims to keep US funding markets running smoothly. Officials lowered the rate on the overnight reverse repurchase agreement facility relative to the lower bound of the target range by five basis points, according to their Wednesday policy statement. 

Taken together with the Fed’s reduction in the overall target range for the fed funds rate to 4.25 per cent to 4.50 per cent, the new RRP rate is 4.25 per cent — in line with the lower bound for the first time since 2021.

Financial institutions currently have some $132 billion in cash squirreled away at the Fed’s overnight RRP facility, which offers money-market investors with an alternative investment in order to help create a floor beneath overnight interest rates, according to the New York Fed. 

That’s compared to a peak of $2.55 trillion stashed at the end of 2022. On Wall Street, balances at the facility are used to gauge how much excess liquidity is in the US financial system — and therefore how much further the Fed can keep unwinding its balance sheet via a process known as quantitative tightening. 

The central bank on Wednesday said it was continuing to shrink its balance sheet. The downshift was foreshadowed in the minutes of the Fed’s November meeting, in which policymakers revealed they saw value in a potential “technical adjustment" so the RRP rate would be equal to the bottom of the target range for the federal funds rate. 

Market watchers have said the move is likely to exert downward pressure on money market rates and further impact the amount of funds held at the Fed facility. Officials last tinkered with the tools when it raised the rate on the RRP facility in June 2021 as a dollar glut in short-term funding markets outstripped supply of investable securities and weighed down front-end rates, despite the steadiness of the Fed’s key benchmark. 

At the time, there was $521 billion in cash at the overnight RRP facility. Dallas Fed President Lorie Logan had said in a speech in October if balances in the facility don’t decline as repo rates rise closer to the interest rate on reserve balances, it may be appropriate to reduce the RRP rate.

19 Dec 2024, 02:20:57 AM IST

US Fed Meeting LIVE: Wall Street tumbles after the Federal Reserve hints at just two rate cuts for 2025

US Fed Meeting LIVE: US stocks are tumbling toward their worst day in four months after the US Federal Reserve hinted Wednesday it may deliver fewer of the cuts to interest rates that Wall Street loves than earlier thought.

The S&P 500 dropped 2.6 per cent to pull further from its all-time high set a couple weeks ago. The Dow Jones Industrial Average sank 961 points, or 2.2 per cent, with less than half an hour remaining in trading, and the Nasdaq composite dropped 3.5 per cent.

The yield on the 10-year Treasury rose to 4.49 per cent from 4.40 per cent late Tuesday. The two-year yield, which more closely tracks expectations for Fed action, climbed to 4.35 per cent from 4.25 per cent.

On Wall Street, stocks of companies that can feel the most pressure from higher interest rates fell to some of the worst losses. Real-estate owners in the S&P 500 fell 3.6 per cent, for example, for one of the largest losses among the 11 sectors that make up the index.

Stocks of smaller companies also did poorly. Many need to borrow to fuel their growth, making them potentially more vulnerable to higher interest rates, and the Russell 2000 index of small-cap stocks fell 3.4 per cent. That was nearly double the S&P 500's fall.

19 Dec 2024, 02:07:43 AM IST

US Fed Meeting LIVE: Powell says 'optimistic' about 'very good' US economy

US Federal Reserve Chair Jerome Powell offered an upbeat outlook on the US economy on Wednesday, saying the labor market had slowed somewhat but remained solid.

"I feel very good about where the economy is," Powell said at a news conference after the central bank lowered interest rates. “Honestly, I'm very optimistic about the economy, and we're in a really good place."

19 Dec 2024, 01:58:09 AM IST

US Fed Meeting LIVE: Fed can't own bitcoin and isn't seeking power, Fed's Powell says

US Fed Meeting LIVE: US Federal Reserve Chairman Jerome Powell said the US central bank has no desire to hold the cryptocurrency Bitcoin amid debate over whether the incoming Trump administration might create some sort of government-owned stock of the asset.

"We’re not allowed to Bitcoin," Powell said a press conference following the latest Federal Open Market Committee meeting. In terms of the legal issues around holding Bitcoin, "that’s the kind of thing for Congress to consider, but we are not looking for a law change at the Fed."

19 Dec 2024, 01:54:38 AM IST

US Fed Meeting LIVE: Gold hits one-month low after Fed signals slower easing pace in 2025

US Fed Meeting LIVE: Gold slipped more than one per cent to a one-month low on Wednesday after the US Federal Reserve lowered interest rates as expected, but noted it will slow the pace at which borrowing costs fall any further, boosting the dollar and Treasury yields.

Spot gold was down 1.5 per cent at $2,606.64 per ounce, its lowest since Nov. 18. US gold futures settled 0.3 per cent down at $2,653.30. Fed Chair Jerome Powell said that Fed policymakers want to see more progress on bringing inflation down as they consider the path of future rate cuts.

Elsewhere, spot silver fell 2.3 per cent to $29.83 per ounce, platinum slipped 1.8 per cent to $922, while palladium declined 2.5 per cent to $910.94. Traders now will be watching out for key US GDP and inflation data due later this week that could further shape expectations around monetary policy.

19 Dec 2024, 01:52:23 AM IST

US Fed Meeting LIVE: US Fed now 'significantly closer' to end of easing cycle, says Powell

US Fed Meeting LIVE: After lowering interest rates three times, the US Federal Reserve is now "significantly closer" to the point where no further cuts will be needed, Chair Jerome Powell said Wednesday.

Powell, speaking at a news conference after the Fed reduced interest rates by a quarter point, said the central bank was now much closer to the "neutral rate" where inflation is adequately mitigated and Fed policies no longer need to be designed to speed or slow growth.

19 Dec 2024, 01:47:23 AM IST

US Fed Meeting LIVE: Treasuries slide as Fed officials signal fewer 2025 rate cuts

US Fed Meeting LIVE: Treasury yields climbed after the US Federal Reserve cut interest rates for a third straight time as expected and signalled that their pace next year is likely to be slower.

The two-year note’s yield, more sensitive than longer maturities to US Fed policy shifts, led the move, rising as much as eight basis points to 4.33 per cent, the highest level since November 25. 

The US central bank lowered its target range for a key overnight lending rate by a quarter percentage point to 4.25 per cent-4.5 per cent, a full percentage point lower than its recent peak. 

The Fed’s policy rate is a key input for Treasury yields, and fading expectations for additional rate cuts since September have driven them back above the four per cent threshold to the highest levels since at least July. 

The benchmark 10-year note’s yield at about 4.43 per cent is about 80 basis points higher since mid-September, creating losses for investors who bought at the lowest yield levels.

19 Dec 2024, 01:43:00 AM IST

US Fed Meeting LIVE: Oil settles up after US crude stocks fall, Fed's 2025 outlook curbs gains

US Fed Meeting LIVE: Oil prices settled higher on Wednesday after US crude inventories fell and the US Federal Reserve cut interest rates as expected, but gains were capped as the US Fed signalled it would slow the pace of cuts.

Brent futures settled up 20 cents, or 0.27 per cent, to $73.39 a barrel. US West Texas Intermediate crude settled up 50 cents, or 0.71 per cent, to $70.58. Both benchmarks retreated from gains of more than $1 a barrel at session highs.

US crude stocks and distillate inventories fell while gasoline inventories rose in the week ending December 13, the Energy Information Administration said on Wednesday. Total product supplied, a proxy for demand, was 20.8 million barrels per day, up 662,000 bpd from the prior week.

19 Dec 2024, 01:41:09 AM IST

US Fed Meeting LIVE: US stocks decline after Fed cuts rates as expected

US Fed Meeting LIVE: US stocks fell on Wednesday, erasing earlier gains after the Federal Reserve cut interest rates by a quarter of a percentage point and the central bank's economic projections signalled a slower pace of cuts next year. Investors were watching comments from Fed Chair Jerome Powell for more insight on the path of interest rates from the central bank.

The Dow Jones Industrial Average fell 266.21 points, or 0.61 per cent, to 43,183.69, the S&P 500 lost 47.02 points, or 0.78 per cent, to 6,003.62 and the Nasdaq Composite lost 182.44 points, or 0.91 per cent, to 19,926.62. The Dow was on track for its 10th straight session of declines, which would mark its longest daily streak of losses since an 11-session skid in October 1974. 

US Treasury yields moved higher after the statement as the benchmark US 10-year note rose 6.3 basis points to 4.448 per cent. Higher interest rates are usually seen as a drag to the equity market, boosting the appeal of less risky assets while crimping the ability of companies to grow earnings.

19 Dec 2024, 01:38:02 AM IST

US Fed Meeting LIVE: Fed's Powell says rate path depends on more progress bringing down inflation

US Fed Meeting LIVE: Federal Reserve Chair Jerome Powell said on Wednesday that Fed policymakers want to see more progress on bringing inflation down as they consider the path of future rate cuts, as inflation has exceeded year-end projections.

"As we think about further cuts, we're going to be looking for progress on inflation. We have been moving sideways on 12-month inflation" Powell told a news conference after the Fed cut rates and signaled a slowing of the pace of future reductions.

"As we go forward, we're going to want to be seeing further progress on bringing inflation down, and keeping a solid labor market."

19 Dec 2024, 01:37:36 AM IST

US Fed Meeting LIVE: Gold drops as US Fed sees slower pace of further cuts in 2025

US Fed Meeting LIVE: Gold prices slipped 1% to a near two-week low on Wednesday after the U.S. Federal Reserve lowered interest rates as expected, but noted it will slow the pace at which borrowing costs fall any further, boosting the dollar and Treasury yields. Spot gold was down 0.9% at $2,622.71 per ounce by 02:26 p.m. ET (1926 GMT). U.S. gold futures settled down 0.3% at $2,653.30.

Elsewhere, spot silver fell 1.6% to $30.05 per ounce, platinum slipped 1.1% to $927.90, while palladium declined 1.8% to $918.23. Futures on the federal funds rate have priced in that the overnight benchmark rates will remain unchanged at the Fed's January policy meeting. Higher rates reduce the appeal of holding the non-yielding asset.

19 Dec 2024, 01:29:13 AM IST

US Fed Meeting LIVE: US dollar rises against peers after Fed delivers rate cut

US Fed Meeting LIVE: The US dollar advanced against its peers on Wednesday after the Federal Reserve delivered a widely expected interest rate cut while also indicating it would slow the pace of its monetary policy easing cycle. The yield on benchmark US 10-year notes rose 6.1 basis points to 4.446 per cent, hitting a four-week high.

The dollar strengthened 0.72 per cent to 0.89895 against the Swiss franc in choppy trading. The euro was down 0.88 per cent at $1.0397. The US dollar index, which measures the greenback against six rivals, was up 0.83 per cent at 107.82, rising to a near four-week high.

19 Dec 2024, 01:26:36 AM IST

US Fed Meeting LIVE: US Fed now 'significantly closer' to end of easing cycle: Powell

US Fed Meeting LIVE: “I think that a slower pace of (rate) cuts really reflects both the higher inflation readings we’ve had this year and the expectations that inflation will be higher" in 2025, Chair Jerome Powell said at a news conference. "We’re closer to the neutral rate, which is another reason to be cautious about further moves." “Nonetheless," Powell said, "we see ourselves as still on track to cut."

19 Dec 2024, 01:23:56 AM IST

US Fed Meeting LIVE: Gold drops as US Fed sees slower pace of further cuts in 2025

US Fed Meeting LIVE: Gold prices slipped one per cent to a near two-week low on Wednesday after the US Federal Reserve lowered interest rates as expected, but noted it will slow the pace at which borrowing costs fall any further, boosting the dollar and Treasury yields.

US central bankers issued fresh projections calling for two quarter-point interest-rate cuts next year amid rising inflation, a forecast consistent with a wait-and-see approach come January as Donald Trump takes the White House.

Spot gold was down 0.9 per cent at $2,622.71 per ounce. US gold futures settled down 0.3 per cent at $2,653.30. Following the US Fed verdict, the dollar extended gains, making gold more expensive for other currency holders, while the benchmark US 10-year yield hit a fresh four-week high. Elsewhere, spot silver fell 1.6 per cent to $30.05 per ounce, platinum slipped 1.1 per cent to $927.90, while palladium declined 1.8 per cent to $918.23.

19 Dec 2024, 01:14:55 AM IST

US Fed Meeting LIVE: US inflation remains 'somewhat elevated': Fed chair Powell

US Fed Meeting LIVE: While inflation has "eased significantly," the level remains "somewhat elevated" compared to the targeted two per cent, US Federal Reserve Chair Jerome Powell said Wednesday.

Powell's comments came at the start of a news conference after the central bank announced it cut interest rates by a quarter point while signaling a slower pace of cuts ahead in the face of lingering concerns about consumer price pressures.

19 Dec 2024, 01:11:20 AM IST

US Fed Meeting LIVE: US Fed policymakers voted 11 to 1 for rate cut

US Fed Meeting LIVE: Slower progress on inflation, which is not seen returning to the two per cent target until 2027, translates into a slower pace of rate cuts and a slightly higher ending point of 3.1 per cent, also hit in 2027, versus the prior "terminal" rate of 2.9 per cent seen as of September.

Fed officials also boosted their estimate of the long-run neutral rate of interest to three per cent. The reduction in the benchmark policy rate to the 4.25 per cent-4.50 per cent range was opposed by Cleveland Fed President Beth Hammack, who preferred to leave the policy rate unchanged.

 

19 Dec 2024, 01:04:24 AM IST

US Fed Meeting LIVE: FOMC on risks to economy, labor market

“In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments," said the US Fed in its statement

19 Dec 2024, 01:03:09 AM IST

US Fed Meeting LIVE: Jerome Powell speaks after US Fed verdict

US Fed Meeting LIVE: Catch US Fed chair Jerome Powell's remarks live here

 

19 Dec 2024, 12:55:00 AM IST

US Fed Meeting LIVE: FOMC statement

In its policy statement, the US Fed said, “In support of its goals, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4-1/4 to 4-1/2 per cent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks."

“The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its two per cent objective," added the FOMC in its statement.

19 Dec 2024, 12:53:27 AM IST

US Fed Meeting LIVE: US Fed policymakers eye slower pace of cuts on elevated inflation

US Fed Meeting LIVE: US Fed officials have underscored that they are slowing their rate reductions as their benchmark rate nears a level that policymakers refer to as “neutral" — the level that is thought to neither spur nor hinder the economy. Wednesday's projections suggest that policymakers may think they are not very far from that level. Their benchmark rate stands at 4.3 per cent after Wednesday’s move, which followed a steep half-point reduction in September and quarter-point cut last month.

19 Dec 2024, 12:51:43 AM IST

US Fed Meeting LIVE: Wall Street slips after the Federal Reserve hints just two rate cuts for 2025

US Fed Meeting LIVE: US stock indexes are edging lower after the Federal Reserve signaled it may deliver fewer cuts to interest rates next year than earlier thought. The S&P 500 fell 0.3 per cent Wednesday immediately after the Fed’s highly anticipated announcement. The Dow Jones Industrial Average lost 38 points, and the Nasdaq composite slipped 0.4 per cent. 

The Fed cut its main interest rate for the third time this year, but that was widely expected. More attention was on projections Fed officials released about where they see rates heading next year. The median forecast is calling for just two cuts, down from four just three months ago. Treasury yields rose.

19 Dec 2024, 12:47:21 AM IST

US Fed Meeting LIVE: US Fed attentive to risks, “inflation somewhat elevated”

"Recent indicators suggest that economic activity has continued to expand at a solid pace. Since earlier in the year, labour market conditions have generally eased, and the unemployment rate has moved up but remains low. Inflation has made progress toward the Committee's two per cent objective but remains somewhat elevated.

The Committee seeks to achieve maximum employment and inflation at the rate of two per cent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate," said the US Fed in its statement.

19 Dec 2024, 12:40:11 AM IST

US Fed Meeting LIVE: US Fed pencils in just two quarter-point cuts in 2025

US Fed Meeting LIVE: US central bankers now project they will make just two quarter-percentage-point rate reductions by the end of 2025. That is half a percentage point less in policy easing next year than officials anticipated as of September.Fed projections of inflation for the first year of the new Trump administration jumping from 2.1 per cent in their prior projections to 2.5 per cent in the current ones - well above the central bank's two per cent target.

Slower progress on inflation, which is not seen returning to the two per cent target until 2027, translates into a slower pace of rate cuts and a slightly higher ending point of 3.1%, also hit in 2027, versus the prior "terminal" rate of 2.9 per cent seen as of September.

19 Dec 2024, 12:39:56 AM IST

US Fed Meeting LIVE: US Fed hikes 2025 headline inflation outlook to 2.5%

US Fed Meeting LIVE: In updated economic forecasts, members of the Fed's rate-setting committee penciled in just two quarter-point rate cuts in 2025, down from an earlier prediction of four, and hiked their inflation outlook for next year, from 2.1 per cent to 2.5 per cent. The Fed has made progress tackling inflation through interest rate hikes in the last two years, and recently began paring back rates to boost demand in the economy and support the labor market.

19 Dec 2024, 12:36:44 AM IST

US Fed Meeting LIVE: US Fed cuts rate by quarter-point in third straight reduction

US Fed Meeting LIVE: The US Federal Reserve cut interest rates by a quarter point Wednesday and signaled a slower pace of cuts ahead, amid uncertainty about inflation and President-elect Donald Trump's economic plans.

Policymakers voted 11-to-1 to lower the US central bank's key lending rate to between 4.25 per cent and 4.50 per cent, the Fed announced in a statement. They also penciled in just two quarter-point rate cuts for next year, and sharply hiked their inflation outlook for 2025.

19 Dec 2024, 12:26:08 AM IST

US Fed Meeting LIVE: Gold edges down as markets eye Fed's 2025 monetary policy outlook

US Fed Meeting LIVE: Gold prices edged lower as the dollar held firm on Wednesday, with investors awaiting a key US Federal Reserve decision expected to shape market sentiment and gold's trajectory by outlining the central bank's 2025 outlook.

Spot gold slipped 0.4 per cent to $2,634.88 per ounce by 12:03 p.m. ET. US gold futures were down 0.4 per cent at $2,651.20. Non-yielding gold tends to do well in a low-interest-rate environment.

Spot silver fell 1.3 per cent to $30.13 per ounce, platinum slipped 0.8 per cent to $930.75, while palladium declined one per cent to $925.04. While markets are pricing in a 99 per cent probability of a 25 basis point rate cut during this meeting, the chances of another reduction in January stand at only 19 per cent.

19 Dec 2024, 12:18:40 AM IST

US Fed Meeting LIVE: US inflation impact on Fed policy review

US Fed Meeting LIVE: “If Trump imposes a 60 per cent tariff on Chinese imports and 10 to 20 per cent tariff on imports from other countries, that would trigger inflation and jeopardise the Fed’s policy of containing inflation, necessitating a rethink of the Fed’s present policy of rate cut. This has the potential to negatively impact global stock markets," said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

The latest inflation numbers, along with strong consumer spending and economic growth, will keep US Fed officials cautious as they debate how quickly to reduce borrowing costs in the months to come. While the labor market is cooling, a retreat in inflation has been key to policymakers’ rationale for cutting interest rates.

19 Dec 2024, 12:12:37 AM IST

US Fed Meeting LIVE: Wall Street drifts ahead of the Federal Reserve's rate decision

US Fed Meeting LIVE: US stock indexes are drifting higher Wednesday as Wall Street waits for an announcement from the US Federal Reserve that could guide its direction into next year.

The S&P 500 rose 0.2 per cent to inch closer to its all-time high set earlier this month. The Dow Jones Industrial Average was up 173 points, or 0.4 per cent, as of 12:56 p.m. Eastern time, and the Nasdaq composite added 0.2 per cent.

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