US markets also crashed Swiss stock market falls ever more sharply
The Federal Reserve's interest rate decision is likely to send the rest of the world's stock markets tumbling after the US markets. The Swiss stock exchange is also plunging.
19.12.2024, 08:49
19.12.2024, 11:39
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- The US stock market reacted badly to the Federal Reserve's interest rate decision.
- The Dow Jones slumped by 2.6 percent and the Nasdaq technology exchange fell by as much as 3.6 percent.
- In Switzerland, the SMI also slipped sharply into negative territory.
As expected, the US Federal Reserve lowered the key interest rate again by 0.25 percentage points the previous evening. However, it also lowered its expectations for further interest rate hikes. This caught investors on the wrong foot and sent US equities and bond markets plummeting.
The Dow Jones slumped by 2.6 percent and the Nasdaq technology exchange even plummeted by 3.6 percent. After the records that have been repeatedly set since the beginning of November, many investors on the financial markets fled risk assets.
The European markets are also unlikely to be able to escape this negative trend. The SMI lost 1.5 percent in the first few minutes after the start of trading, with most shares down significantly. Shortly before midday, the loss is already over 1.8 percent.
The US Federal Reserve had predicted fewer interest rate cuts for the coming year than previously due to stubbornly high inflation. At the same time, Fed Chairman Jerome Powell emphasized that it was still too early to include the economic measures announced by future US President Donald Trump in the forecasts. "It's very premature to try to draw any conclusions," Powell said with regard to the far-reaching tariffs that the Republican is threatening.
Dollar gains
The US dollar also reacted to the Fed's statements, rising above the 90 centime mark against the franc for the first time since the summer. However, the greenback recently traded slightly below this level again at 0.8998 francs.
Meanwhile, the euro weakened further against the dollar to 1.03812 dollars. Shortly before the Fed chief's statements, it had still cost almost 1.05 dollars. Gold also recovered some of its recent losses.
