The reduction in securities purchases by the US Federal Reserve, which was in line with expectations, weakened the dollar somewhat on Wednesday. In return, the euro rose 0.3 percent to $ 1.1612. The monetary authorities around Fed chairman Jerome Powell decided to melt their security purchases, which currently total 120 billion dollars per month, from mid-November. This process, known in technical jargon as tapering, of gradually reducing the dose of the cash injections launched in the corona pandemic, is expected to be completed in June next year. However, according to the US Federal Reserve, the time for interest rate hikes has not yet come. The prospect of persistently low interest rates in the euro area weighed on the returns on European government bonds. The ten-year German government bond yielded its lowest level in a month. The interest rate fell to minus 0.194 percent after minus 0.159 percent the previous day. From the point of view of the President of the European Central Bank, Christine Lagarde, an interest rate hike is currently unlikely to be expected next year.
Meanwhile, oil prices fell significantly. A barrel of North Sea Brent cost $ 81.33, four percent less than the day before. The industry association API had previously reported a surprisingly high increase in US inventories in the past week.
An unexpectedly strong job creation in the US private sector increased the pressure on the “anti-crisis currency” gold. The precious metal is cheaper by 0.8 percent to $ 1,773 a troy ounce. The strong numbers from the labor market fueled speculation on economic growth and bubbling corporate profits, says Naeem Aslam, analyst at the brokerage house Ava-Trade. This makes “safe havens” less attractive.