Since September 2024, the U.S. financial market has been like a small boat in a storm, swaying and restless. New storms hit every day, causing investors to be on edge with the ups and downs of the stock market. Everyone is waiting for the storm to pass and for the financial market to calm down.
The Federal Reserve's monetary policy has always been a focus of attention, and it's no joke. The U.S. economy itself has many problems, like hidden diseases that flare up from time to time. The core CPI in September rose by 4.3% year-on-year, far exceeding market expectations, and inflation has not been curbed at all. What's worse, the risks hidden in the U.S. economy are intensifying, such as the rise in corporate debt levels and the worsening wealth disparity. Looking at these numbers, one must be aware! This is not just a game of numbers, but a true reflection of the U.S. economy.
Looking at the trend of unemployment benefit applications again, they continue to rise and have reached a new high of 215,000! How can the economic recovery not be affected? The latest statement by Federal Reserve Governor Bostic is particularly noteworthy. He announced a pause in interest rate hikes in November, and market expectations suddenly reversed, sparking intense discussions. Will the pace of economic recovery slow down as a result? This question is hanging in front of everyone.
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This reversal was really unexpected! The three major U.S. stock indices fell together, with the Nasdaq index falling more than 2%, setting a new low. The global market also became turbulent, and international oil prices also fell. The whole situation is like a domino effect, with one falling and the entire chain following suit. Investors can't help but feel panic and start to question the future trend of the global economy.
The U.S. Treasury market has attracted a lot of safe-haven funds, and the yield on 10-year U.S. Treasury bonds has risen to an eight-week high. Behind this phenomenon, the huge scale of U.S. public debt is worth paying attention to. So far, U.S. public debt has reached an astonishing level of $35.7 trillion, and the debt risk hidden danger is becoming increasingly serious. Faced with such a huge debt scale, investors have begun to worry about the U.S. government's debt repayment ability, which in turn affects the stability of the entire financial market.
Let me tell you, the Federal Reserve's interest rate hikes and cuts are like a roller coaster, making people feel ups and downs, high and low. Take this time, for example. Everyone was hoping for some stability, but it turned out to be so much trouble, catching investors off guard. We can't blindly follow the trend, we need to be more vigilant, analyze market changes, and make wise investment decisions. Otherwise, we may be swayed by market fluctuations.
The internal problems of the U.S. economy are emerging. The fierce inflationary pressure and the obvious trend of increasing unemployment indicate that there are serious problems with the economic structure. The Federal Reserve's policy adjustments are like a doctor's random treatment, sometimes effective, sometimes backfiring. Bostic's statement is like adding fuel to the fire, making the market a mess and making investors feel confused and worried about the future prospects.The fragility of the global economy once again alerts us: once there are fluctuations in the dollar's trend, global currencies and capital flows will also be implicated. The rise and fall of the dollar will affect the economic lifelines of other countries, and the currencies and capital markets of various nations will also be turbulent as a result. This situation is akin to a large family where if the eldest sibling has problems, the younger ones cannot expect to fare well either. Therefore, the stability of the global economy is of vital importance to every country.
We must carefully consider the long-term impact of the Federal Reserve's cautious interest rate reduction strategy on the global financial market. What is the specific effect of such changes in the dollar's trend on other currencies and capital flows? Without clarity on these issues, we cannot have a solid grasp! The Federal Reserve's interest rate reduction strategy will have a profound impact on the global financial market, and changes in the dollar's trend will affect the changes in other currencies and capital flows. We need to understand these issues to better cope with the changes in the financial market.
In summary, the turmoil in the U.S. financial market affects the entire body, with far-reaching implications. We investors must remain highly vigilant, respond calmly, and pay attention to the changes in the market every moment, lest we be overwhelmed by the waves. In this way, we can steer steadily in the turbulent financial market, seek opportunities, and avoid risks.