Markets await Fed decision
The eyes of the trading world are firmly fixed on this evening’s FOMC meeting, where the Fed is expected to provide markets with its economic projections.
U.S. stocks showed some optimism prior to the meeting, where the Fed is expected to deliver positive economic forecasts. These will be centred around a renewed pledge to keep interest rates low for as long as the world’s biggest economy needs, in order to fully recover from its deepest economic recession in history
As of writing, the Dow Jones was up close to 0.42%, with the S&P 500 gaining 0.40% before the meeting. FedEx was one of today’s biggest gainers, climbing 7.2%.
U.S. retail sales slow in August
Today it was reported that consumer spending in the US slowed in August as more Americans decided to save rather than spend as COVID-19 cases rose last month.
Figures released by the Commerce Department showed that overall retail sales came in up 0.6% last month, after being forecasted to come in at close to 1%.
Currently, consumer spending accounts for over two-thirds of U.S. GDP and the numbers released today could potentially grab the attention of Fed officials as they wrap up their economic policy meeting.
The Dollar declined in strength against its closest geographical partner Canada, falling to support of 1.3152 on the news.
OECD expect global economy to fall 4.5%
Although the global economy has performed better than expected since the peak of the coronavirus outbreak, the OECD today warned that markets should still expect further declines in the short term.
During its latest economic forecast, the Organisation for Economic Co-operation and Development stated that the world economy will contract by 4.5% this year. In June the group pointed to a 6% decline in global GDP.
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Senior Market Analyst