Financial markets were already an extraordinary year, but recent prices have recently been particularly strange, according to Robin Brooks, an older colleague at the Brookings Institute.
in Procsk Post on Tuesday Entitled “Super Weird Markets since Jackson Hole”, has followed the path of the main assets since the President of the Federal Reserve Jerome Powell Open the door to evaluate the discounts In a letter at the annual central bank symposium last month.
“You thought this would affect the dollar, raise the S&P 500 and enhance commodity prices in all fields. But this did not happen,” Bruks wrote. “The only thing that was transferred is gold, with a large increase in prices by approximately 10 percent.”
Certainly, stocks have risen since his position Good inflation data The road was cleared of the FBI price discounts when politics meet on Tuesday and Wednesday. Gold prices also rose, new levels were placed along the way and closed on Friday at $ 3680.70 an ounce.
But the bond market is spent unexpectedly. Brooks noted that the treasury returns for 30 years did not decrease immediately after Powell’s speech, but it decreased after another report on the bad jobs after two weeks.
He added: “The fact that the return of the treasury for 30 years has not immediately decreased strange and disturbing.” “It took very weak salaries to do so finally.”
In addition, although the dollar index had some rise and landing, he returned to the place it was before Powell’s speech, as Brocks described “not intuitive” because expectations to reduce the federal reserve would decrease.
Meanwhile, Bitcoin was sold after Jackson Hole, but she also returned to the place where she started, although cryptocurrencies generally acted like risk origins in the past and previously gathered on the severed hopes.
“What does all this mean? The recent market movements indicate that gold is the final safe haven,” said Brooks. “Bitcoin proves very volatile and speculative, so – as the political pressure on the escalating of the Federal Reserve – is attracted to the markets to gold.”
Fears of the debt crisis in France and the United Kingdom have increased the revenues of global bonds in recent weeks. I hope in France in France in France in particular hopes that Paris will work on a deficit any time soon.
Friday evening, Fitch reduced credit rating for France From AA-to A+, the lowest level ever in the second largest economy in the eurozone, saying that the main shift to financial discipline is unlikely.
Brooks said it is possible that the crisis in France has sent more investors looking for a safe haven towards the dollar, and may explain the reason for the stability of Greenback.
After his post, other global events raised more geopolitical concerns that the dollar may also prefer. Israel attacked Hamas leaders in Qatar, a close ally in the Middle East, which sparked a sharp violent reaction in the region and sending oil prices to the top.
Russian drones entered the Polish air field, forcing NATO allies to revitalize air defense systems and deploy combat aircraft that shot down the plane.
“The bottom line is that there are a lot of things in the markets that are not currently loud together at all,” said Brooks.
The main question is whether the rise in gold prices is a sign that the dollar is losing the state of backup, although it is believed to be just a temporary noise and sees a lack of the center in the end.
On Tuesday note, Michael Brown, the chief research strategy in Pepston, also noticed that the individual market movements were continuing.
But he said that “The Tell” is a 10 % decrease in the dollar so far against other global currencies, which stems from President Donald Trump’s efforts to weaken the independence of the federal reserve, exacerbate the deficit, and rearrange the global trading system.
“When you take all of this, these market movements suddenly begin to feel a much more,” Brown added. “Yes, the connections are unusual. However, they are the total economic environment, as well as policy options that are still taken, as government spending escapes with itself through DM, and the reduction in prices in the resumption of the United States, and the risk of inflation remains inclined to the upward trend, and that potentially possible re -economic ventilation has now been implemented (do not carry).”
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