US equity markets recovered, following the Federal Reserves decision to hold rates unchanged, while the US Dollar tumbled. The Fed decided to hold rates unchanged, reaffirming the dovish monetary stance the new Chairman will employ. The Fed’s preferred inflation indicator, the PCE, confirmed inflation remained steady. US GDP growth has declined slightly, to an annualised 1.5%, but remains strong. European GDP readings from France. Germany and the EU confirmed benign growth, marginally positive, amazingly avoiding a technical recession. Inflation spike to 2.8% in Germany, reflects the dire energy situation, within Europe. The avalanche of data confirms inflation is on the rise again in Europe and the extended recession continues. The weaker US Dollar allowed the EUR to surge above 1.1500, while the GBP jumped to 1.3450.
Commodity currencies also benefit the slump in the reserve, the NZD powering back towards 0.5900, while the AUD hit 0.7025. NZ Business Confidence data confirmed a pre-election jump, although economic conditions could deteriorate fast, if the energy crises re-emerges.
