Wall Street reported a bullish session close on Wednesday and the Dow Jones Industrial Average, which is the main indicator, rose about 0.54% after the Federal Reserve’s decision to raise about 25 basis points in the United States was known.
The Fed’s decision to raise a quarter of a point in US interest rates to shift them from 0.75% to 1.00% met market expectations. The Federal Reserve took action last Wednesday to raise interest rates for the second time in less than three months, given the country’s steady economic growth, solid data on employment, and confidence that inflation is moving towards the goal of the US Central Bank.
Wall Street received this news with great optimism and its main indexes registered advances after the increase of the types of interests of the United States on the part of the FED, in addition to the selective S & P 500 a best behavior was registered, which led to the increases after a clear advance of 0.85% to 2,385 points was recorded.
The Dow Jones Industrial Average posted a rise of 0.54%, to be very close to the psychological quota of 21,000 points, while the NASDAQ index rose 0.63% at the end of the session on Wall Street. The dollar fell on the currency exchange market following the Fed’s decision.
The monetary policy committee did not suggest any plans to accelerate the pace of monetary tightening, expressing that even though the inflation was very near the 2% objective of the FED the goal is symmetric.
The Federal Reserve reported that the new interest rate hikes will be gradual, and some of the officials maintained the prospects of the two more rate increases this year, after that, there was only one increase in 2016.
According to the spokesman of the FED, the investment of the companies seems to have strengthened after the increase announcement of the interest rates that is why the Federal Reserve Committee hopes that through the gradual adjustments of these economic activity will be able to expand at a moderate pace.
US stocks widened gains on Wall Street, and bond yields fell as the gradual pace continued given the continuation of the gradual pace of interest rate hikes that the Central Bank pointed out.
In the foreign exchange market, investors turned their back on the dollar at first after the decision to increase interest rates in the United States decision taken by the Fed and the EUR-USD, in the Forex market, the US Dollar advanced to be well above the 1.07 Dollars per euro.
In this way, U.S Dollar dropped drastically on the interchange on the Exchange market towards the Japanese currency to set on the quota 113 Yens per Dollar.