Today to be held Federal Reserve System meeting - 14.12.2022

On Tuesday, the US dollar index fell and updated a 6-month low. This was facilitated by US inflation data in November. It decreased to a 12-month low and amounted to 7.1% y/y. Because of this, market participants expect the completion of the Fed rate hike in May 2023 at 5% or even 4.75%. Now it is 4%. At today's meeting of the US regulator, the rate may be increased by 0.5% to 4.5%. After that, it remains to increase it only 1-2 times by 0.25%. The expected stabilization of the FRS rate caused the weakening of the US currency. This morning the UK inflation data for November came out. It also decreased - to 10.7% y/y compared to 11.1% y/y in October. Tomorrow there will be a meeting of the Bank of England, which is expected to raise the rate to 3.5% from the current level of 3.5%.

Bitcoin quotes yesterday showed excellent growth to almost $18,000. Rumors have appeared on the crypto market about a slight delay in the withdrawal of USD Coin (USDC) from the Binance exchange. It is possible that against this background, some players have become more likely to buy Bitcoin at their own expense. Now the situation on working crypto-exchanges has stabilized. A positive factor was the arrest on Bahamas of the former head of the FTX crypto exchange Sam Bankman-Fried. US authorities are now investigating the bankruptcy of FTX.

Yesterday, US stock indices, of course, rose due to expectations of an early stabilization of the Fed's rate. Recall that too high lending rates increase the costs of corporations. Pharmaceutical company Moderna soared nearly 20% after it reported a successful trial of a new skin cancer drug. Goldman Sachs raised its assessment of the attractiveness of the shares of the social network Meta Platforms Inc and the pharmaceutical company Pfizer. They added 4.7% and 1.7%, respectively. Quotes Alphabet Inc rose by 2.5%. The S&P 500 Real Estate (+2%) was the leader among industry indices yesterday, as investors expect real estate transactions to pick up as mortgage rates stabilize.

Today, oil is rising in price for the 3rd day in a row. The price of Brent again exceeded $80 per barrel. Several factors contributed to this. Due to an accident and an oil spill, the Keystone Pipeline closed. It was pumping 620,000 barrels per day (bpd) of Canadian oil to the US. Investors expect an increase in demand for oil as a fuel in China after the lifting of anti-coronavirus restrictions. So, according to Variflight, the number of air passengers in China increased by 68% over the week. At the same time, they are still 37% less than in 2021 and 68% less than the level of pre-Covid 2019. According to the American Petroleum Institute (API), US oil inventories increased by 7.8 million barrels over the week. Usually this is a negative for quotes, but now the growth of stocks can be positive. Market participants do not exclude the beginning of a recovery in U.S. Strategic Petroleum Reserve and additional demand for oil from the US government. Russia may suspend the sale of its oil to countries that have supported economic sanctions against it in the form of a price cap on Russian oil of $60 per barrel (G7 price cap).