Fear in Global Markets: Rising inflation and interest rate hikes issued by central banks in an effort to contain it have slowed economic growth, eroding investor confidence in the stock market, cryptocurrencies and other risky investments.
Asian markets break down
All-round selling pressure remained in Asian markets on Friday. One of the main functions of central banks is to keep inflation under control. Market analysts say that central banks, which manage inflation better at the time of Corona transition, seem to be faltering in the current economic scenario and their announcements are not being embraced by investors.
Federal Reserve and Bank of England have raised interest rates
According to the report of The Guardian, 75 basis points hike in interest rates by the US Federal Reserve has proved to be unfavourable to investment sentiment. The Fed Reserve has increased the interest rate so much since 1994. Along with this, the Bank of England has also increased interest rates five times since December. The Swiss National Bank has raised interest rates for the first time after 15 years.
good news just from japan
However, in this whole environment, only good news has come from Japan. Bank of Japan has not increased interest rates and has said that it will continue to take a soft stance. The Bank of Japan said on Friday that interest rate hikes by other central banks are an unfavorable sign for the stock market. This race to increase the interest rate is not over yet.
Estimates of global economic growth are getting cut
Announcements of hike in interest rates have forced economists to cut estimates of global economic growth. According to the report of The Guardian, many experts believe that by next year America will be in the grip of recession. This will increase the chances of a fall in the global market.
This year did not prove to be good for the stock markets
This year has not proved to be good for the major stock markets around the world so far. For the first time after nearly 60 years, such a fall has been registered in the stock market. The S&P 500 benchmark index has fallen 23 per cent since January 2022. On Thursday, it had registered a huge decline of 3.25 percent. Analysts at JP Morgan say the way the S&P 500 benchmark index has rolled out, there is an 85 per cent chance of a recession. This is the condition of Dow Jones, Nasdaq, FTSE and European markets. The effect of all this is also visible on the Asian markets.
Stock market, crypto market all broken
Japan’s Nikkei has fallen 1.65 percent and India’s Nifty is also on the same path. Australia’s stock market also fell two percent on Friday. The declining phase of crypto is also continuing. Bitcoin is down 7.8 percent and Ethereum 8.45 percent.
Indian stock market condition
Today in the Indian markets, the BSE Sensex closed at 51,360.42, down 135.37 points or 0.26 percent. On the other hand, the Nifty of NSE has closed trading at 15,293.50 with a fall of 67.10 points or 0.44 percent.