Powell says Fed committed to full range of tools to support economy
Federal Reserve Chairman Jerome Powell confirmed the bank’s ability to support the US economy to return to its growth path, adding that Fed remains committed to using full range of tools.
However, Powell said the US economy may need more fiscal and monetary support from the federal government and Congress.
Powell expected the economic recovery will depend on the ability to keep the coronavirus in check in the coming period, noting that citizens commitment to social distancing guidelines in public places help the economy to recover.
Bearing in mind that the US Federal Reserve held the interest rate between zero and 0.25%, and signaled that it plans to keep near zero at least until the end of 2023.
Gold closes higher as dollar rises
Gold prices rose on Wednesday, as the US dollar rose against most major currencies, after the Federal Reserve’s decision.
The US Federal Reserve held the interest rate between zero and 0.25%, and signaled that it plans to keep near zero at least until the end of 2023.
The central bank raised its estimates for the GDP in 2020, but lowered its forecasts for the unemployment rate to 7.6% due to the rapid recovery of the economy during this summer.
The dollar index rose against a basket of currencies by 0.2% to 93.05 points as of 19:56 GMT, after it hit a high of 93.1 and a low of 92.7.
The US retail sales index rose 0.6% in August, in its third straight monthly increase.
Gold December futures rose 0.2% or $3.40, to close at $1,970.50 an ounce, after hitting today's high at $1,983.8 and the low at $1,957.2.
US crude jumps nearly 5%, rises above $40
Oil prices rose on Wednesday, to extend gains, after the US crude inventories data showed a higher than expected drop in the EIA weekly report.
The Energy Information Administration (EIA) showed today that the US crude inventories fell by about 4.4 million barrels to 496 million barrels during the past week, better than forecasts of -1.8 million.
The American Petroleum Institute (API) showed yesterday in preliminary data that inventories fell 9.5 million barrels during the same period.
Hurricane Sally lumbered across the Gulf of Mexico, which led to the suspension of a large portion of the US oil and natural gas production in the vital region.
As of 17:48 GMT, WTI crude October futures (NYMEX) rose 4.8% to $40.1 a barrel, after it hit a high of $40.1 and a low of $38.3.
Brent November futures rose 4% to $42.1 a barrel, with a high of $42.2 and a low of $40.5.
Dollar holds with interest rate decision in focus
The US dollar held steadily against most major currencies on Wednesday, as focus shifted to the Federal Reserve and the interest rate decision.
The US retail sales index rose 0.6% in August, its third straight monthly increase, but came lower than forecasts of 1.1%, vs. 0.9% in July.
The US Federal Reserve will announce its rate decision later today, which is widely expected to keep the rate near zero within its efforts to support the economy in the fight against the coronavirus crisis.
Fed Chairman Jerome Powell will hold a press conference following the decision to comment on monetary policy and the latest economic developments.
The Fed kept the interest rate unchanged near zero and pledged on taking all the necessary tools and measures until the economy recovers and returns to its growth path.
The dollar index held against a basket of currencies at 93.05 points as of 18:30 GMT, after it hit a high of 93.1 and a low of 92.7.