The Fed will cut interest rates by 25 basis points and will cut the excess reserve rate, but policymakers have differences over whether further monetary easing is needed. Powell stressed that the economic prospect is sound. The US money market showed signs of stabilization, and the Federal Reserve plans to continue its $75 billion repurchase operation on Thursday. Trump instructed the Treasury to substantially increase sanctions against Iran and will announce it within 48 hours.
- The Dow Jones Industrial Average closed at 27,147.08 points, up 36.28 points or 0.13%. The Standard & Poor’s 500 Index closed at 3,006.73 points, up 1.03 points or 0.03%. The Nasdaq index closed at 8,177.39 points, down 8.62 points or 0.11%.
- The Fed will cut interest rates by 25 basis points for the second time and will cut the excess reserve rate. However, policymakers have differences over whether monetary easing is still needed. Chairman Powell said that “moderate” policy actions should be enough to sustain the growth of the US economy.
- Trump instructed the US Treasury to substantially increase sanctions against Iran and said it would announce its decision within 48 hours.
- The UK’s FTSE 100 index closed at 7,314.05 points, down 6.35 points or 0.09%. The Frankfurt DAX index closed at 12,389.62 points, up 17.01 points or 0.14%. The French CAC40 index closed at 5,620.65 points, up 5.14 points or 0.09%.
- The National Bureau of Statistics of the United Kingdom announced that without the seasonal adjustment, the monthly output of the UK Producer Price Index (PPI) fell from 0.3% increase in previous month to 0.1% drop in August, which was lower than the market expectation of a 0.2% increase.
- The European Bureau of Statistics announced that the monthly rate of the consumer price index (CPI) in the euro zone in August rose from 0.5% to 0.1%, but still below the market expectation of 0.2%.
- Japan’s Nikkei 225 index closed at 21,960.71 points, down 40.61 points or 0.18%. The yen closed at 108.190 against the US dollar, down 0.055%.
- The Bank of Japan is expected to keep interest rate and asset purchase plans unchanged on Thursday. However, investors still need to remain highly vigilant, as in view of the Japan Governor, Haruhiko Kurodaat, at the July meeting, he said he has a “more positive” attitude towards overweighting stimulating measures and is willing to consider further reducing the negative interest rate when necessary.
- The Shanghai Composite Index closed at 2,985.66 points, up 7.54 points or 0.25%. The Shanghai and Shenzhen 300 Index closed at 3,910.08 points, up 18.86 points or 0.48%. The RMB closed at 7.089 against 1 US dollar, up 0.110%.
- According to CCTV reports, Chinese President Xi Jinping requested to strengthen major infrastructure construction during his inspection in Henan Province.
- Dow Jones reported that Huawei was suspended from the Global Cyber Security Forum due to US restrictions on exporting technology to Huawei.