A choppy week for equity markets
Last week was another volatile week for equity markets. We started off with the Fed minutes showing the Fed would put its breaks of rate hikes this year and we ended it with a huge surprise in the US jobs number which made investors re-think the possibility of a rate hike in the US.
But it wasn’t the US alone that created volatility in equity markets. The uncertainty of Brexit as well as disappointing data out of Germany led to a spike in volatility.
Below is a better understanding of what really went on during the week:
Fed minutes
Federal Reserve officials are in a holding pattern heading toward their July policy meeting, following the release of mixed economic data and the vote by the United Kingdom to exit the European Union.
Fed governor Daniel Tarullo said Wednesday the central bank should wait for more convincing evidence that inflation is closer to—and would remain near—the Fed’s 2% target before raising short-term interest rates again. He also warned that because rates are still so close to zero, the Fed has limited tools to respond if the economy slows down, another factor that argues for a wait-and-see approach.
US jobs data
U.S. employers added 287,000 jobs in June,...