Global stock markets faced pressure on Friday following comments from U.S. Federal Reserve Chair Jerome Powell, signaling a slower pace of interest rate cuts. European and Asian markets, which had already been weak after Wall Street’s losses, struggled further, as investor concerns about a potential China-U.S. trade war weighed on sentiment.
The U.S. dollar dipped after a rally driven by President-elect Donald Trump’s election victory, which had previously fueled optimism. Powell’s remarks on Thursday, stating that the economy is not signaling an urgent need to lower rates, prompted a reevaluation of future Fed policy. While a rate cut is still expected next month, markets are scaling back expectations for further cuts in 2025.
Investors also voiced concerns about Trump’s plans for tax cuts and tariffs, which could reignite inflation and lead to currency pressure, especially in trade-exposed economies in Asia and the eurozone.
In Europe, stock markets showed weakness despite a modest economic growth forecast by the European Commission. However, London stocks edged higher after disappointing economic data revealed that the UK economy grew less than expected in Q3.
In Asia, while Shanghai fell 1.5%, Tokyo saw a slight rise, despite reports of slower economic growth in Japan. China’s retail sales data exceeded expectations, growing 4.8% year-on-year in October, boosting hopes for economic recovery.
Meanwhile, Bitcoin stabilized around $89,000, after hitting a record high of $93,462 earlier in the week, with some analysts speculating it could soon surpass the $100,000 mark amid Trump’s pro-crypto comments.
