Fed meeting will take place today - 15.12.2021

On Tuesday, the US dollar index rose for the second day in a row in anticipation of today's Fed meeting. Investors hope the Federal Reserve will accelerate the tapering of the 4th quantitative easing program to $ 25 billion a month. It is now expected to be cut by $ 15 billion per month and will be fully completed in June 2022. The QE 4 program began in March 2020 at a volume of $ 120 billion per month. Its goal is to support the American economy affected by the coronavirus epidemic. The Fed rate hike of 0.25% is not expected today. In addition to the Fed meeting, important economic data for Retail Sales for November and Business Inventories for October are due in the US today. Their forecasts look moderately negative and the US dollar index is correcting slightly downward today. The Consumer Price Index and Producer Price Index for November were released in Britain today. They updated their multi-year highs. The British pound strengthened on the expectation that the Bank of England (BoE) will somehow show an urge to tighten monetary policy due to high inflation at its meeting tomorrow. Let us remind you that the meeting of the European Central Bank (ECB) will also take place on December 16, and the Bank of Japan (BoJ) will take place on December 17. Bitcoin corrected slightly upward yesterday after a 5-week decline. Investors feared that the Fed would criticize the US cryptocurrency market. Since earlier, some cryptocurrency exchanges and crypto exchangers began to launch various interest rate instruments by the type of deposits and even loans. Thus, they compete with banks. If today the Fed does not react to this in any way, then bitcoin quotes may rise significantly. Elon Musk has raised Dogecoin quotes by almost 15%, saying that it is considering selling Tesla electric vehicles for these tokens. At the same time, Musk continues to actively get rid of its own Tesla shares.

Yesterday US stock indexes fell for the second day in a row. A possible tightening of the Fed's monetary policy contributes to the strengthening of the US dollar, but negatively affects the stock market. An additional negative for the stock market was the strong growth of the Producer Price Index (+ 9.6%) in November. This is the highest increase in 11 years. Artificial meat producer Beyond Meat soared 9.3% after investment firm Piper Sandler raised its recommendation on its stock.

Today oil is getting cheaper for the third day in a row. Investors fear the resumption of the global lockdown due to the new variant of the Omicron coronavirus. Recently, it was first recorded in China. The International Energy Agency (IEA) has cut its forecast for global oil demand in the 1st quarter of next year. The independent American Petroleum Institute announced a decline in US oil reserves for the week by 0.815 million barrels. However, so far this has not particularly supported the quotes. Nevertheless, WTI is currently trading above the psychological level of $ 70 per barrel.