Mixed Signals in US Markets: Fed Rate Uncertainty, Rising Mortgage Rates, and Stable Gold Prices

The uncertain timing of US Federal Reserve interest rate cuts continues to impact American stock markets.

Mortgage rates for 30-year loans in the USA have reached their highest level since November last year, standing at 7.24 percent.

 Gold prices remain steady as investors await upcoming US data that may offer insights into the Fed's interest rate plans. Currently, gold is trading around $2,330 per ounce, with reduced demand due to easing tensions between Israel and Iran.

US stock index futures are down particularly the Nasdaq, which has seen a decline of over 1%. Meanwhile, the US 10-year bond yield hovers around 4.65%, and the dollar index remains relatively stable after a slight increase yesterday.

According to data from CME, there's a 70% chance that the Fed will begin reducing interest rates at its September meeting.

Despite reports of a 6.4 million barrels decrease in oil stocks, prices remain subdued. This is likely due to reduced risk appetite in the market.

The Japanese yen slipped below 156 against the dollar, a level not seen since May 1990, after the Bank of Japan opted to keep interest rates steady, in line with expectations. The central bank also adjusted inflation projections upward and remained upbeat about economic growth prospects. Despite Tokyo's core inflation easing to 1.6% in April due to the introduction of education subsidies, concerns linger. With the yen depreciating about 10% against the dollar this year, investors are borrowing yen to invest in higher-yielding currencies. Attention is on Japanese authorities for potential intervention to stem the yen's decline.