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- The US Federal Reserve doubles the pace of stimulus withdrawal
- Stocks turn positive near the end of the week, bitcoin price floats near $50,000
Fed Announces Faster Stimulus Wind Down
The event of the week, the Federal Reserve’s final press conference of 2021, rattled the global financial markets. On Wednesday, Chairman Jerome Powell appeared to give his remarks and take questions on the Fed’s next steps.
In his comments, Mr. Powell said the US central bank is going to double the pace of its stimulus withdrawal. In other words, the Fed will be unwinding its monetary support by $30 billion a month. Also, he announced Fed officials have agreed to perform at least three interest rate hikes in 2022.
As a result, stocks on Wednesday were boosted by increased optimism among traders and investors. All three major indexes gained 1% or more to close the day with gains. The next day, however, stocks across the board slipped as the positive mood faded quite quickly.
Stock Jitters Rise, Gold Tops $1,800
That said, stocks finished the week mixed as market participants scrambled to position for the final days of 2021.
Over to cryptocurrency markets, the price of bitcoin spent the week pressured below $50,000 per coin. Moreover, there was a brief dip in the orange token’s price on Monday. Bitcoin then hit a weekly low of $45,700. Throughout the week, however, the leading digital currency held relatively steady near $48,000.
Elsewhere, the price of gold advanced roughly 3% to cross $1,800 after the keenly-anticipated Federal Reserve press conference. The precious metal peaked at a two-week high as traders flocked to the safe-haven asset.
Omicron Worries Persist in Europe
In the meantime, the Omicron virus strain continued to be a reason for concern globally. In Europe, particularly, major economies struggled to contain the spread. To this end, France and Germany kept their seven-day average near 50,000 cases.
Further, the UK reported a record 78,610 coronavirus cases on Wednesday. Also, the Bank of England became the first of major central banks to raise its interest rate after the global pandemic swept the markets.