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The Fed Will Announce A Plan To Reduce Debt Purchases

The Fed Will Announce A Plan To Reduce Debt Purchases

On the first day of the two-day meeting of the Federal Reserve on November 2nd, gold and silver both fell. The price of gold fell back to US$1,787.45, while the price of silver was hovering at US$23.52. The safe-haven market is currently focusing on the revised increase in the US dollar. The US dollar index has now reached 94.097, while the US 10-year Treasury bond yield has fallen to 1.554%. The abandonment of precious metals and U.S. Treasury safe havens by investors means that market preference for risk is brewing and intensifying. The Fed began a two-day monetary policy meeting on Tuesday. It is widely expected that after the meeting on Wednesday, the Fed will announce its plan to reduce its debt purchase (Taper). U.S. Treasury yields plummeted on Tuesday, and the yield curve became steeper. Bank of America Merrill Lynch’s U.S. Debt Option Volatility (MOVE) soared to an 18-month high, showing that investors were worried about the direct risks brought by the Fed’s policy on Wednesday. US President Biden said that he has been considering the nomination of the next chairman of the Fed, and the White House will announce the result soon. Outsiders speculate that Biden may follow the precedent of former President Trump and announced after the Fed's November interest rate meeting.
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