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The minutes confirmed that the lack of interest rate hike is indeed a pause and not the end of the rate hike cycle, and further rate increases will be necessary. Most bankers supported the pause; however, members who favored a 25 basis point hike paid particular attention to the tight labor market and sustained strong momentum in the economy.
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In response to this information, markets began to assess higher chances of continued rate hikes. Wall Street is experiencing slight losses, although the scale of the declines is minimal.
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EURUSD broke to daily lows after the release of the report following the last FOMC decision. The main currency pair is trading around 1.085.
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The markets did not react to today's final industrial orders data from the US. The final MoM dynamics for May came in slightly weaker at +0.3% compared to the expected +0.8%.
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Market sentiment deteriorated during the day after disappointing data from China weakened risk appetite, leading to a decline in market confidence. Last month, China recorded slower growth in the services sector, surpassing expectations but reaching the lowest level since January. The decline in growth was attributed to reduced consumer spending.
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Today's sell-off in European markets hit the domestic stock market with double force, with the WIG20 index closing 2.01% lower, approaching support levels around 2,000 points.
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Crude oil (Oil.WTI) is experiencing a rebound of over 1% today. The improvement in sentiment came after comments from Saudi Energy Minister Abdulaziz, who said that Russia's oil export cut was voluntary and no one forced Russia to limit supplies.
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Abdulaziz stated that OPEC+ will do whatever is necessary to support the markets and that the oil market will not be left unattended.
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Gold prices are deepening their declines after the release of the FOMC minutes, pushing the price down to $1,915 per ounce.
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Cryptocurrencies are also facing selling pressure today. Bitcoin is falling below $31,000, while Ethereum is trading around $1,900. The declines may be partly due to recent strong gains and investor nervousness ahead of the FED minutes release. Another positive development in the market is the filing of another spot Bitcoin ETF application, this time by Valkyrie Investments.
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