VALUE FLUCTUATIONS
Despite the recent dovish comments from the Federal Reserve regarding a possible rate cut, Bitcoin has faced a decline in value compared to various assets. The fall contrasted with the surge seen in other assets, reflecting uncertainty surrounding the U.S. election and its impact on the crypto market. The market’s reaction has been influenced by the contrasting stances of presidential candidates Donald Trump and Kamala Harris, with Harris’s rising popularity potentially affecting Bitcoin’s price. The ongoing factors of seized Bitcoin sales, developments with Mt. Gox creditors, and the Federal Reserve’s indicated rate cut plans have also contributed to the recent market fluctuations. Nonetheless, despite these challenges, it is still worth to remark that Bitcoin has displayed substantial growth this year, particularly with the inflow of funds through U.S. exchange-traded funds, although there has been a slight decrease in value from its peak in March.
LABOR MARKET SLOWER
The recent data from the Labor Department has indicated that the U.S. labor market is experiencing a slowdown, with initial applications for unemployment benefits reaching the highest level in almost a year. The number of claims rose by 14,000 to 249,000, exceeding economist forecasts. States like Michigan and Missouri reported significant increases in claims. Additionally, continuing claims, used as a measure of those receiving benefits, have surged to 1.88 million, marking the highest level since November 2021. Moreover, it is important to remark that when compared with the previous two years saw the unemployment rates are currently higher. Also, Federal Reserve Chair Jerome Powell noted growing risks in the labor market, citing moderated job growth and increased unemployment rates.
RISE DUE TO POSSIBLE CONFLICT
Oil prices have experienced a significant increase, with U.S. crude futures breaking above $78 per barrel, following the assassination of Hamas political leader Ismail Haniyeh in Tehran. This event has raised concerns about a potential direct conflict between Israel and Iran, prompting Iran’s Supreme Ayatollah to order a strike on Israel in retaliation. The surge in oil prices highlights the impact of geopolitical tensions on energy markets, as top Iranian officials plan to meet with militant groups in the region. Analysts warn that the situation could escalate into a wider war, potentially affecting global oil markets and adding further uncertainty to the energy sector.
REVENUE BOOM
Meta, the parent company of popular social media platforms Facebook and Instagram, released its second-quarter earnings report, which exceeded expectations on both revenue and earnings per share. However, it is worth noting that while the company performed well in the quarter, it cautioned investors about anticipated significant capital expenditures growth in 2025 due to infrastructure costs. Neverthess, despite this warning, Meta’s stock saw a notable increase by climbing more than 6%. The company’s revenue for the quarter reached $39.07 billion, surpassing analyst estimates, with its Family of Apps revenue totaling $38.72 billion. Meta also introduced its latest open-source AI model, Llama 3.1, signaling its commitment to innovative technologies. Nonetheless, its Reality Labs segment, focused on mixed reality hardware and software, faced challenges with declining revenue and continued financial losses. Additionally, Meta faced legal issues, as Texas Attorney General Ken Paxton announced a $1.4 billion settlement over the use of biometric data without consent.
INTERNATIONAL NEWS
The Bank of England recently made the decision to cut interest rates for the first time in over four years, bringing the key rate down to 5%. This move, supported by Governor Andrew Bailey’s tie-breaking vote, was aimed at providing relief to households grappling with high borrowing costs. The decision marks a cautious approach by the central bank, in line with similar actions taken by other advanced economies. While inflation remains a concern, forecasts indicate that it may fall below the desired target in the years to come. Despite stronger-than-expected economic growth and persisting inflation pressures, the majority decision to lower rates was seen as necessary to manage inflation risks while supporting economic recovery. The rate cut is expected to have a positive impact on mortgage borrowers and businesses, potentially boosting economic growth as the new Labour government aims to prioritize public service improvements.
