SHARE

Share this news item!

US Economy's Slowdown Triggers Market Rally as Fed Rate Cuts Loom

US Economy's Slowdown Triggers Market Rally as Fed Rate Cuts Loom

US Economy's Slowdown Triggers Market Rally as Fed Rate Cuts Loom?w=400
The latest release of the US jobs opening data and the Federal Reserve's Beige Book indicates signs of a slowing American economy.
While reasons range from the current government's economic policies to broader market challenges, the outcomes have intrigued Wall Street and bond markets alike.
This weakening scenario has set a stage where the Fed might consider cutting interest rates sooner than expected, contributing to a market rally.
As a result, safe-haven assets like gold have reached record highs, and currencies such as the Australian dollar have seen newfound strength.

In Asia, stock markets saw varied performances. China's Shanghai Composite and Hong Kong's Hang Seng Index witnessed declines beyond 1% and 0.6% respectively. Meanwhile, Japan's Nikkei 225 also experienced a drop of 0.9%, with escalating bond yields cited as a contributing factor. However, Australian markets had a sharper sell-off, with the ASX200 dropping nearly 2%, despite positive cues from Wall Street prompting a slight rise in futures.

European indices managed a lukewarm recovery, with the Eurostoxx 50 marking a 0.6% increase owing to a weaker Euro. However, the sustainability of this momentum remains a question as recent downturns continue to challenge the market's strength.

Wall Street rebounded, buoyed particularly by the NASDAQ’s more than 1% rise and a 0.5% lift in the S&P500. Here, short-term charts suggest a potential return to upward momentum following a strategic repositioning post-long weekend.

Currency markets are responding dynamically to the falling USD, with the Euro rebounding to mid-1.16 levels aided by weak US economic indicators. USDJPY pair adjustments post-Fed announcements indicate a complex interplay between geopolitical factors and domestic economic signals.

In commodities, the Australian dollar holds steady despite the Reserve Bank of Australia’s anticipated rate cut and recent poor CAPEX data. Supporting levels around 65 cents bolster the currency, suggesting resilience amid USD fluctuations.

Crude oil markets are attempting a push for positive growth but faced restrictions overnight as both WTI and Brent prices pulled back. Similarly, gold exceeds previous highs, continuing its bullish trend with strong investment interest and market confidence supplementing upward momentum.

Overall, the financial markets are navigating a multi-faceted landscape: from currency shifts to commodity movements, each reflecting underlying economic strategies and outcomes.

Published:Friday, 5th Sep 2025
Source: Paige Estritori

Share this news item:

Finance News

US Economy's Slowdown Triggers Market Rally as Fed Rate Cuts Loom
US Economy's Slowdown Triggers Market Rally as Fed Rate Cuts Loom
05 Sep 2025: Paige Estritori
The latest release of the US jobs opening data and the Federal Reserve's Beige Book indicates signs of a slowing American economy. While reasons range from the current government's economic policies to broader market challenges, the outcomes have intrigued Wall Street and bond markets alike. This weakening scenario has set a stage where the Fed might consider cutting interest rates sooner than expected, contributing to a market rally. - read more
Melbourne: Australia's Most Affordable Major City Housing Market
Melbourne: Australia's Most Affordable Major City Housing Market
03 Sep 2025: Paige Estritori
Recent data from PropTrack highlights Melbourne as the most affordable major capital city in Australia for housing, as it continues to record the slowest dwelling value growth compared to other state capitals. Over the year leading up to August, Melbourne's property prices increased by merely 2.1%, starkly overshadowed by the growth rates in cities like Sydney, Brisbane, Perth, and Adelaide. - read more