{"id":113265,"date":"2017-09-21T07:05:00","date_gmt":"2017-09-21T11:05:00","guid":{"rendered":"http:\/\/countingpips.com\/?p=113265"},"modified":"2017-09-21T06:06:13","modified_gmt":"2017-09-21T10:06:13","slug":"fed-announces-october-start-of-balance-sheet-reduction","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/09\/fed-announces-october-start-of-balance-sheet-reduction\/","title":{"rendered":"Fed announces October start of balance sheet reduction"},"content":{"rendered":"
September 21, 2017<\/div>
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By IFCMarkets<\/a><\/p>\n

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SP 500 and Dow close at fresh highs while Nasdaq slips<\/h2>\n<\/div>\n<\/div>\n

US stocks\u00a0<\/b>closed at fresh record highs on Wednesday as Federal Reserve announced the start of its $4.5 trillion balance sheet reduction in October. The dollar strengthened: the\u00a0live dollar index<\/a>\u00a0data show the ICE US Dollar index, a measure of the dollar\u2019s strength against a basket of six rival currencies, rose 0.7% to 92.441. The\u00a0S&P 500<\/a>\u00a0advanced less than 0.1% settling at fresh record high 2508.85 led by financial and industrial shares. The\u00a0Dow Jones\u00a0<\/em>rose 0.2% to new record high 22412.59 with gains in McDonald\u2019s and Pfizer offsetting 1.7% drop in Apple.\u00a0Nasdaq\u00a0<\/em>composite meanwhile fell less than 0.1% to 6456.04.<\/p>\n

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The US central bank kept federal funds rate between 1% -1.25%, as widely expected, but said it would start to shrink its balance sheet by $10 billion a month. The Fed said it would increase that pace by $10 billion every three months to a maximum pace of $50 billion a month, or $600 billion a year. Twelve out of the sixteen policy committee members indicated they expected to deliver a third rate increase by the end of 2017. Treasury yields rose, with probability of another rate hike in December, as priced by traders in fed funds futures, jumping to 72% compared with 56% the previous day, according to CME Group\u2019s FedWatrch tool.<\/p>\n<\/div>\n<\/div>\n

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European stocks slip<\/h2>\n<\/div>\n<\/div>\n

European stocks\u00a0<\/b>edged lower on Wednesday as investors awaited Federal Reserve\u2019s decision. Both the\u00a0euro\u00a0<\/em>and\u00a0British Pound<\/em>reversed previous session gains against the dollar. The Stoxx Europe 600 index slipped 0.04%. Germany\u2019s\u00a0DAX 30\u00a0<\/em>added 0.1% to 12569.17. France\u2019s\u00a0CAC 40\u00a0<\/a>rose 0.1% while UK\u2019s\u00a0FTSE 100\u00a0<\/em>lost 0.05% to 7271.95. Indices opened higher today.<\/p>\n

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The Pound ended lower after hitting 15-month high above $1.36 level following UK\u2019s Office for National Statistics report of better than expected retail sales in August: retail sales rose 1% after upwardly revised 0.6% increase in July.<\/p>\n

\"GB<\/p>\n<\/div>\n<\/div>\n

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Asian stocks lower<\/h2>\n<\/div>\n<\/div>\n

Asian stock indices<\/b>\u00a0are mostly lower today as stronger dollar after Fed\u2019s decision weighed on commodity prices.\u00a0Nikkei\u00a0<\/em>managed to rise 0.2% to 20347.48 as yen extended losses against the dollar with the Bank of Japan keeping policy unchanged. Chinese stocks are down: the\u00a0Shanghai Composite Index is 0.3% lower and\u00a0<\/em>and Hong Kong\u2019s\u00a0Hang Seng Index\u00a0<\/em>is down 0.04%. Australia\u2019s All Ordinaries Index fell 1% despite a drop in Australian dollar against the greenback.<\/p>\n

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Oil retreats<\/h2>\n<\/div>\n<\/div>\n

Oil futures prices\u00a0<\/b>are lower today. Prices climbed yesterday helped by rising tensions between the US and Iran and expectations that OPEC will decide to extend its production cut deal. Prices ended higher despite US government data showing a bigger than expected 4.6 million barrels rise in crude supplies. November Brent crude rose 2.1% to $56.29 a barrel on Wednesday on London\u2019s ICE Futures exchange.<\/p>\n

Market Analysis provided by IFCMarkets<\/a><\/p>

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Note:
\nThis overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or \u0430 recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.<\/p>\n","protected":false},"excerpt":{"rendered":"

By IFCMarkets SP 500 and Dow close at fresh highs while Nasdaq slips US stocks\u00a0closed at fresh record highs on Wednesday as Federal Reserve announced the start of its $4.5 trillion balance sheet reduction in October. The dollar strengthened: the\u00a0live dollar index\u00a0data show the ICE US Dollar index, a measure of the dollar\u2019s strength against […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-113265","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/113265","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=113265"}],"version-history":[{"count":3,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/113265\/revisions"}],"predecessor-version":[{"id":113273,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/113265\/revisions\/113273"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=113265"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=113265"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=113265"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}