Global stock markets posted modest gains as investors looked ahead to potential changes in the Federal Reserve’s policy framework, with sentiment lifted by hopes of measures that could sustain economic growth.
In the United States, major indices opened slightly higher, reflecting cautious optimism ahead of key remarks from Fed officials expected to outline a revamp of interest rate and inflation strategies.
Market participants are closely watching for signals that the central bank may adopt a more flexible approach to managing inflation, potentially allowing it to run above the current target for periods to stimulate the economy.
Analysts say the possibility of a policy shift has encouraged investors to hold positions in equities despite broader concerns about slowing growth and persistent geopolitical tensions.
The technology sector led early gains, supported by strong corporate earnings and renewed demand for growth stocks. European and Asian markets also closed in positive territory, mirroring Wall Street’s cautious uptick.
Meanwhile, gold prices climbed sharply, extending recent gains as investors sought safe-haven assets in anticipation of potential monetary easing.
Spot gold rose to multi-week highs, buoyed by expectations that looser Fed policy could weaken the US dollar and reduce the opportunity cost of holding non-yielding assets.
The precious metal has been supported by ongoing uncertainty in global trade and concerns over slowing industrial output in major economies.
Bond markets were relatively stable, with US Treasury yields holding near recent lows, reflecting the market’s anticipation of prolonged accommodative policy.
Currency markets saw the dollar retreat slightly against major peers, further underpinning commodity prices.
Traders are preparing for heightened volatility in the coming sessions as the Fed’s announcement draws closer. While equity markets have responded positively to the prospect of supportive measures, analysts caution that the pace of gains may remain limited until there is greater clarity on the central bank’s long-term strategy.
Written By Ian Maleve
