• GBPUSD : 1.23589
  • EURJPY : 118.833
  • GBPCHF : 1.19403
  • GBPCAD : 1.76154
  • GBPAUD : 2.02921
  • EURGBP : 0.88585
  • AUDUSD : 0.60895
  • USDCHF : 0.96607
  • HK50 : 23296.9
  • EURNZD : 1.84301
  • AUDJPY : 66.086
  • NZDUSD : 0.59394
  • EURCAD : 1.56073
  • CADJPY : 76.127
  • EURUSD : 1.09499
  • EURAUD : 1.79789
  • GER30 : 9723.3
  • SPX500 : 2588.56
  • EURCHF : 1.05795
  • USDJPY : 108.513
  • NAS100 : 7794.75
  • GBPNZD : 2.08025
  • XAGUSD : 13.985
  • AUDCAD : 0.86796
  • GBPJPY : 134.125
  • US30 : 22050.1
  • JPN225 : 18557.4
  • FRA40 : 3922.36
  • USDCAD : 1.42520
  • AUDNZD : 1.02502
  • UK100 : 5547.16
  • NZDCAD : 0.84660
  • USOIL : 22.374
  • AUS200 : 4717.87
  • USDCNH : 6.42822

Global markets continue to shrink despite central bank stimulus

Date : 2020-03-24 14:38:56

Global markets continue to shrink despite central bank stimulus

In recent days, major central banks are trying to take action against the effects of the virus, which is disrupting daily life in other countries and bringing global economic crisis as well as global industries and supply chains.

However, the financial markets did not respond positively to the measures, raising doubts about the effectiveness of monetary policy in times of crisis.
The central bank announced a decision to cut the interest rate to almost 0% on Sunday, followed by other central banks, including the ECB and the Bank of Japan on Monday. In joint action, many central banks and central banks have agreed to put liquidity into the market, while some of them have also decided to lower their interest rates (that's the case with the Reserve Bank of New Zealand) and to ease its monetary policy form.

The question now is whether the Federal Reserve still has action to face this economic impact, especially as the virus continues to spread throughout the world, and it remains unclear whether How long will the world's economic crisis be continues? At the moment, there are about 199,000 cases, with nearly 8,000 deaths, countries such as Italy and Spain currently struggling with the rise in infections and deaths, which is the United States seems to be moving towards a similar situation.

The Federal Reserve has allowed the Treasury to use $ 425 billion to finance loans, guarantees and other investments to support facilities created by the Federal Reserve Board in an effort to provide liquidity to financial systems that support Lend money to qualify for business in the state or city. 

The central bank can check at other corporate debt purchases as well as some types of municipal debt. At the same time, he said, the Fed needed to be cautious with such actions and that it could be problematic in choosing which debt to buy, because European authorities were struggling with the purchase of state debt.

The closure of the institute due to the outbreak of virus on the economy was worse than expected that annual GDP declining by 14% in the April-June period, while the Bank of America and the Oxford economy both declined by 12%.

A report on Sunday said they expected the economy to shrink to 30.1% in the second quarter, boosting the average unemployment rate by 12.8% over the period.

The Federal Reserve and other bank regulators said in a statement late Sunday that they are encouraging banks to modify loan terms for customers affected by the coronavirus such as payment delays.

Pivot Point: 1567
Resistance1: 1584     Support 1: 1553
Resistance2: 1608   Support 2: 1539
Resistance3: 1633   Support 3: 1532
Today’s USD/XAU Signals:
Today recommendation: Traders should buy gold: 1561, Set Take Profit: 1605, Stop loss: 1553.

Analyzed by: Ms. Van Sreytouch, Independent Analyst

Goldwell Capital Co., Ltd. endeavours to ensure the accuracy and completeness of this research report. However, as the market is subject to change, the Company and our subsidiaries do not guarantee its completeness and accuracy, and the information is for reference only. Any person shall not regard such information as Goldwell Capital Co., Ltd. on leveraged foreign exchange, precious metals, stocks, and other financial products to provide real quotes, suggestions, solicitation and inducement of investment. Guests should be aware of the risks involved in the investment, the volatility of the investment market and the risk of loss can be very big, guests must carefully consider their own financial situation and investment purposes, to decide the direction of investment and the kind of investment products that are suitable for their owns.