Fed cut expectations are out of the window [Video]

Ipek Ozkardeskaya Swissquote Bank Ltd

Yesterday’s inflation update from the US didn’t go well. January data showed a hotter-than-expected report across monthly and annual readings and all categories including food, energy and housing.

As such, the Federal Reserve (Fed) rate cut expectations melted like snow under the sun after yesterday’s clear uptick in US inflation suggested that the Fed would better wait and see before doing anything else. The US yields rose, risk appetite weakened while the US dollar unexpectedly softened.

Gold, too, gained despite the rising US yields and the historically negative relationship between US yields and gold prices is no longer a thing.

Elsewhere, crude prices plunged on hope of resolution in Ukraine.

Author

Ipek Ozkardeskaya

Swissquote Bank Ltd

Ipek Ozkardeskaya began her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked in HSBC Private Bank in Geneva in relation to high and ultra-high-net-worth clients.

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