While the interest rate decision of the US Federal Reserve (Fed) continues to be decisive on the direction of global markets, the selling pressure seen in the New York stock exchange yesterday following the bank’s interest rate increase has been replaced by a more optimistic outlook, especially in the futures markets.
Yesterday, the Fed increased interest rates for the first time since 2023, increasing the policy rate by 25 basis points in line with expectations and raised it to the range of 3.75-4 percent.
In its statement, the Fed pointed out that economic activity was expanding at a solid pace. In the statement, it was stated that productivity growth was strong and capital investments were solid, employment increases were at the same pace as the increase in the workforce and the unemployment rate did not change significantly.
The bank, which took the interest rate decision unanimously, last increased the policy rate by 25 basis points to the range of 5.25-5.50 percent in July 2023, as part of the fight against high inflation.
The bank’s inflation forecasts were increased from 3.6 percent to 3.7 percent for this year, while they were maintained at 2.3 percent for 2027. The Fed revised its inflation forecast from 2 percent to 2.1 percent for 2028 and set it to 2 percent for 2029.
The dot chart showing future interest rate expectations of Federal Open Market Committee (FOMC) members also revealed that 16 out of 18 officials foresee at least one more interest rate increase this year.
“The reality is that inflation is too high and has been for too long,” Fed Chairman Kevin Warsh said at a press conference. he said.
Emphasizing that the inflation data announced this summer did not show that fundamental trends have improved significantly, Warsh said that today’s interest rate increase decision is the right step towards ensuring price stability.
US President Donald Trump called for interest rates to be reduced to 1 percent or lower after the Fed increased its policy rate.
While the predictions that the bank will continue to increase interest rates caused a decrease in risk appetite in the markets yesterday, Fed President Kevin Warsh’s emphasis on his determination on inflation enabled the index futures contracts to recover on the new day.
As the predictions that the Fed will continue its tight monetary policy have gained strength, the dollar index, which was above 100 for the first time since August 4 yesterday, is on a horizontal course at 100.3 on the new day.
Looking at geopolitical developments, Trump stated that Tehran contacted them directly to make a deal and said, “I hope we are moving towards the end of the war (with Iran).” he said.
In addition to Trump’s statements, news that US officials held secret meetings in Oman with the Iran-backed Houthi militias in Yemen and that Saudi Arabia will offer additional crude oil cargoes via Oman were another factor that increased the risk appetite in global markets.
With these developments, the barrel price of November delivery Brent oil, which decreased by 2.7 percent to 105.8 dollars yesterday, remains horizontal on the new day.
An ounce of gold is traded at 4 thousand 287 dollars, with an increase of 0.5 percent on the new day, due to the decrease in oil prices. The US 10-year bond interest rate is at 5.01 percent.
The New York stock market ended the day with a decline after the Fed’s interest rate decision. Following the Fed’s interest rate decision, the decline in bank stocks attracted attention due to concerns that high interest rates could slow down credit growth and the economy.
Shares of JPMorgan Chase, one of the largest banks in the USA, lost 1 percent, shares of Bank of America lost 2.7 percent, shares of Wells Fargo lost 3 percent and shares of Goldman Sachs lost 4 percent.
On the macroeconomic data side, the average interest rate for a 30-year mortgage (home loan) in the USA rose to 6.97 percent last week, reaching its highest level since May 2025.
Retail sales in the country increased by 1.2 percent on a monthly basis in August, above expectations. In the USA, the import price index increased by 0.7 percent and the export price index increased by 0.6 percent on a monthly basis in August.
With these developments, the Dow Jones index lost 1.21 percent, the S&P 500 index lost 0.45 percent and the Nasdaq index lost 0.01 percent.
Index futures contracts in the USA started the day positively. News of progress on a bill aimed at regulating energy costs in data centers in the US was effective in the rise in futures contracts on the Nasdaq index.
European stock markets followed a positive course yesterday due to the easing in oil prices and the decrease in selling pressure on the bond market.
The rise in mining stocks in the region came to the fore yesterday. Inflation in the UK accelerated due to the increase in energy prices. Annual inflation in the country reached its highest level in 5 months with 3.1 percent. Transportation costs and motor fuel prices were effective in the acceleration in inflation in the country. It is predicted that inflation in the UK may rise above 4 percent in the coming months.
The interest rate decision of the Bank of England (BoE) will be the focus of the markets today.
BoE is expected to keep the policy rate constant at today’s interest rate decision meeting, but with increasing inflationary expectations, the bank is expected to increase interest rates at its November meeting.
On the other hand, European Union (EU) Commission President Ursula von der Leyen said that they want to pave the way for Canada to become the first “associate member” of the EU.
With these developments, the FTSE 100 index in England gained 0.28 percent, the DAX index in Germany gained 0.53 percent, the CAC 40 index in France gained 0.62 percent and the FTSE MIB index in Italy gained 0.80 percent.
Index futures contracts in Europe started the day positively.
Asian stock markets are mixed on the new day after the Fed took a determined stance in the fight against inflation by increasing interest rates.
The decline in oil prices yesterday also limited the downward trend in Asian markets today. On the other hand, tomorrow’s interest rate decision of the Bank of Japan (BoJ) is in the focus of the markets.
BoJ is preparing to increase the policy rate from 1 percent by 25 basis points to the highest level in 31 years, due to the pressure created by rising energy costs increasing inflationary concerns and the depreciation of the yen.
With these developments, near the closing, the Kospi index in South Korea increased by 0.9 percent, the Nikkei 225 index in Japan increased by 0.1 percent, the Hang Seng index in Hong Kong decreased by 0.7 percent, and the Shanghai composite index in China decreased by 0.4 percent.
BIST 100 index at Borsa Istanbul, which followed a sales-oriented trend yesterday, finished the day at 13,122.58 points, losing 5.54 percent of its value.
The October futures contract based on the BIST 30 index in the Borsa Istanbul Futures and Options Market (VIOP) decreased by 0.8 percent in last night’s session compared to the normal session closing.
On the other hand, the Financial Stability Committee (FIK) convened at 08.00 today under the chairmanship of the Minister of Treasury and Finance Mehmet Şimşek.
While Dollar/TL completed the day yesterday at 48.6560 with a 0.1 percent increase, today, at the opening of the interbank market, it is traded at 48.6750, just above the previous closing.
Analysts stated that today, housing sales, short-term external debt statistics, Central Bank of the Republic of Turkey (CBRT) Monetary Policy Committee (PPK) meeting summary and weekly money and bank statistics will be followed domestically, and abroad, an intense data agenda, especially the Consumer Price Index (CPI) in the Euro Zone and the BoE’s interest rate decision, will be followed. Technically, 13,000 and 12,900 points in the BIST 100 index will be support, 13,300 and 13,300 points will be followed, analysts said. He noted that 13,400 points are in resistance position.
