Banking system uncertainty leads further fluctuations between the dollar and the gold
Bank of England follows US Fed move and hikes rates
Gold boosted as the USD declines due to the Feds pessimistic tone last night
Bank of England raises rates by a quarter percentage point in today's meeting
Swiss National Bank raises interest rates by half a percentage point
Gold continues to rise
Gold prices have been steadily increasing and are now stabilizing at around $1980 per ounce. The US Federal Reserve recently held its second meeting of the year and raised interest rates by 25 basis points, bringing the rate to 5% for the ninth consecutive time. Despite this move, the Federal Reserve's chair, Jerome Powell, stated that the bank will continue to closely monitor data and use all available tools if necessary. Powell also emphasized the need to address individual bank problems to prevent them from threatening the entire banking system.
The decline of the US dollar has benefited gold prices, contributing to their recent stability around the $1980 per ounce level. The dollar index has settled around the 102.00 level. These market developments suggest that investors are paying close attention to central bank actions and their potential impacts on global financial markets.
Bank of England raises rates
In its second meeting of the year, the Bank of England has announced a 25 basis points increase in interest rates, bringing the final rate to 4.25%. The Monetary Policy Committee voted 7-2 in favor of this quarter-point rate hike. The decision was based on an increase in the inflation index, which grew to 10.4%, higher than the previous reading of 10.1%.
Following this news, the GBP/USD currency pair saw a slight increase, with the rate of trade nearing the $1.2280 level. These market developments suggest that investors are paying close attention to central banks' actions and their potential impacts on the financial markets.
Swiss National Bank announces interest rate decision
As anticipated, the Swiss National Bank has announced a rate hike of 50 basis points, making the interest rate 1.25%. This is the fourth consecutive time that the bank has raised interest rates. The decision was driven by inflation rates in Switzerland that have exceeded the bank's targets, with the consumer price index growing annually by more than expected at 3.4%, higher than the previous reading of 3.3%. These market developments suggest that the Swiss National Bank is taking action to address inflationary pressures and promote sustainable economic growth.