What’s next for the markets?
Revenue and dollar: With the Fed signaling reluctance to cut rates, Treasury yields could remain high, potentially testing the 10-year Treasury bond at 4.60%. A strong dollar is likely to remain a headwind for commodities and emerging markets.
Stocks: Stocks could face continued selling pressure as traders digest tighter monetary conditions. For the S&P 500, support at 5,900 is key, with downside risks towards 5,700 as bearish sentiment increases.
Gold and silver: Precious metals face near-term headwinds, but underlying inflationary pressures and economic uncertainty may provide support. For gold, a sustained break below $2,590 could push the price to $2,546, while silver risks falling towards $27.71.
In summary, the Fed’s aggressive shift has increased volatility across asset classes, with rising rates driving the dollar higher and risky assets lower. Traders should keep an eye on upcoming inflation data and Fed commentary, which will determine whether this trend continues or stabilizes.
More information in our Economic Calendar.