Today there is a FOMC meeting concluding. Investors will be snooping around for details from the meeting, particularly as it pertains to the Fed’s plans for the near future. Federal Reserve Chairman Jerome Powell has already dismissed the possibility of cutting interest rates into negative territory, but there are other tools available to the central bank to regulate the market. With the recent jump in unemployment, experts fear that the economy is in greater trouble than previously estimated.
This pessimism was also echoed in a report from the Organization for Economic Cooperation and Development, which states that the current recession will be the worst one seen in modern times, with comparable results to the economic devastation after World War I and II. The exact prediction for a decrease in economic growth varies between 7.6% and 6%, depending on whether the pandemic returns to countries that have already experienced it.
The coronavirus remains an issue for many countries. The number of Covid-19 infections in Brazil has surpassed 740,000, while Russia has almost half a million cases. The total number of coronavirus cases internationally is over 7.3 million.
When it comes to fundamental reports, today we expect inflation data from the United States, which, together with the Fed meeting report, will offer a better understanding of the current situation in the United States.
Later in the day we also expect data on the current supply of crude oil. It is expected that this week the US surprisingly increased its production levels, which is pressuring oil prices. As a result, today the WTI slumped to $37.89, while the Brent crude fell to $40.27. The long-term sentiment for oil remains bearish due to the oversupplied market.
