The most significant event of the month is behind us: the Fed has finally decided on its first interest rate cut this year. Today is also a "Triple Witching Day," when futures and options contracts on stocks and indices expire, which naturally signals the end of the quarter. This period can contribute to increased volatility in financial markets. Given that indices and gold are near historical highs, the situation could become very interesting. The next week will be rich with preliminary PMI index releases, and we will also learn the decisions of the central banks of Sweden and Switzerland. In the United States, attention will be focused on the key PCE inflation reading, although it will likely not have as much of an impact on the market as the recent Fed decision. Therefore, in the coming days, it is worth monitoring markets such as GOLD, EURCHF, and US100.
GOLD
The price of gold reached new historical highs on the day of the Fed's interest rate decision. Despite the first rate cut this year and hints of further moves, the gold market has seen a correction since the decision. Demand appears to be slowing at such high price levels, in the $3600-$3700 range, although major institutions are raising their forecasts for the precious metal by the end of the year. Thursday will be crucial for gold, as we will hear from four key Fed members who may provide greater clarity on the tone of the last interest rate decision. On Friday, we will get the PCE inflation data, the Fed's preferred measure of consumer price changes.
EURCHF
On Thursday, we will get the decision on interest rates in Switzerland. Although inflation in the country is only 0.2%, Switzerland has avoided the risk of deflation. Of course, high tariffs on Switzerland remain a problem, impacting the economy. Nevertheless, SNB head Martin Schlegel recently stated that cutting interest rates below zero introduces many new risk factors for the economy. The market also expects interest rates to remain unchanged. While a weaker franc would benefit the economy, numerous geopolitical threats worldwide continue to keep the Swiss franc in demand. Only a significant strengthening of the euro could lead to a breakout of EUR/CHF from the consolidation that has been in place since April.
US100
US indices are not slowing down, setting new historical highs day after day. The Fed has essentially confirmed that it sees no risk of a recession, which, combined with the possibility of further rate cuts, provides a basis for continued growth in indices. Statistically, September has not typically been a good month for Wall Street, but last year the indices strengthened and are on track to repeat that trend in 2025. Naturally, investors' eyes will be on key semiconductor companies, such as Nvidia, which is currently facing some issues in China, and Intel, which has gained another strategic investor in the form of Nvidia. Thanks to this investment, Intel's shares gained as much as 30% in a single day.
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