Fed suspends interest rate cuts, gold soars and pulls back, U.S. index fluctuates higher

This week, the market was in trouble again as the attempt to rebound in risky assets encountered selling pressure. Both the S&P 500 and the Dow are expected to close higher this week, but selling pressure remains.

Investors pulled large amounts of funds from global equity funds within a week before March 19 due to ongoing concerns about the impact of U.S. President Donald Trump's tough trade policy on the global economy.

There was a hint of optimism after the FOMC meeting, but it quickly faded as the sellers returned collectively.

They sold a net worth of $29.7 billion in global equity funds this week, the largest single-week outflow since December 18, according to LSEGLipper.

This week's FOMC meeting saw the return of a word that many market participants mocked, that is "temporary." This is the answer given by Fed Chairman Jerome Powell when asked about the possibility that tariffs could lead to increased inflationary pressure.

This will be a key consideration for measuring market performance this year, as it may determine the extent of interest rate cuts that central banks can achieve. Looking at the Fed's updated forecast, it doesn't paint an attractive picture.

Forex Market:The US dollar index fluctuates higher this week. At the beginning of the week, the US dollar index once performed sluggishly and hit another five-month low. Thanks to the time when the EU delayed the tariff counter to the United States, the dollar selling wave slowed down and stood at the 104 markIt hit a new high in the past two weeks, closing at 104.168 this week. In terms of non-US currencies, as the US dollar rebounds, the euro, the pound and the Australian dollar all fluctuate and fall against the US dollar, and the US dollar is expected to close higher against the Japanese yen for the second consecutive week. The Bank of Japan's policy stance unexpectedly shifted from hawks in January to neutral.

Gold Market:Spot gold rose after reaching the historic mark of $3,000 last week, hitting a high of $3,057 per ounce this week, setting a new record high. However, on Friday, spot gold fell sharply, falling below the $3,000/ounce mark, down more than $50 from the historical high, and closed at $3,023.31/ounce this week.

Crude oil market: International oil prices rose this week due to factors such as the resurgence of the situation in the Middle East, the decline in U.S. fuel inventories and the issuance of new sanctions on Iran. However, the increase in oil prices was limited because Putin agreed that Russia and Ukraine would not attack each other's energy infrastructure construction for 30 days.

Review of the news this week

1. The Federal Reserve remained silent, Powell emphasized uncertainty 16 times

The Federal Reserve decided to maintain the benchmark interest rate at 4.25%-4.50% with an 11-1 vote ratio, and slowed down the pace of balance sheet shrinkage starting from April, and the scale of Treasury bond reduction dropped from US$25 billion to US$5 billion. The dot chart shows that interest rate cuts are expected to be cut twice this year and next year, but the number of officials who support no interest rate cuts or fewer interest rates in 2025 will increase. Powell mentioned "uncertainty" 16 times at the press conference, emphasizing that there is no need to rush to adjust policies, and for the first time the impact of tariffs on inflation. Trump called on the Fed to cut interest rates to cope with the impact of tariffs on the economy.

2. The Bank of Japan keeps interest rates unchanged

The Bank of Japan keeps the benchmark interest rate unchanged at 0.5%, believing that the economy is recovering moderately, but uncertainty in trade policy remains. President Kazuo Ueda said the interest rate path will depend on changes in economic data.

3. The Bank of England keeps interest rates unchanged

The Bank of England keeps the benchmark interest rate unchanged at 4.5%, and inflation is expected to peak at 3.75% in the third quarter of 2025. The market's bet on interest rate cuts this year has not changed significantly.

4. Russia and Ukraine ceasefire proposal was rejected, and Zelensky refused to be a "dish meal"

Trump spoke with Putin and proposed a 30-day ceasefire in Ukraine, but was rejected by Putin, who only agreed to limit attacks on Ukraine's energy infrastructure. Zelensky stressed that Ukraine must participate in the armistice negotiations and refused to hand over control of the Zaporo thermonuclear power plant. Russia and the United States will hold Black Sea security negotiations in Saudi Arabia to discuss a ceasefire and restart the Black Sea food agreement.

5. The war in Gaza rekindled, and the ceasefire agreement regenerated and twists and turns

Israel launched a large-scale air strike on the Gaza Strip and expanded ground operations to cut off Hamas' north-south ties. Hamas accused Israel of violating the ceasefire agreement and called on international mediation parties to intervene. U.S. government confirms Israel is in actionBefore the movement, he informed the US side.

6. The United States has set off a wave of "anti-Mark" violence. Can the White House stand up to turn the tide?

Tesla has faced resistance due to Musk's political stance, and dealers and facilities in many states have been damaged. Musk said security measures have been strengthened and Trump warned vandals to face heavy fines. Investment banks such as JPMorgan Chase have lowered Tesla's target price, and the market is pessimistic about Tesla's prospects.

7. Trump sets a two-month nuclear deal deadline for Iran

Trump sent a letter to Iran's supreme leader Khamenei, demanding a new nuclear deal within two months, otherwise he will face serious consequences. Khamenei responded that the United States will not have any effect by relying solely on threats.

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