Market Uncertainty and Geopolitical Tensions: What is Happening in the World?

Current data indicates that the Fed will maintain interest rates at 3.50-3.75% with a probability of as much as 99.5%. This means that investors do not expect changes in monetary policy in the near future. On the other hand, forecasts for rate cuts in 2026 have been reduced, suggesting that the Fed may be forced to maintain its current policy longer than previously expected. The labor market in the USA shows some signs of stabilization, with unemployment at 4.3%, slightly better than forecasts. However, the slowdown in wage growth (3.5% YoY, below the forecast of 3.7%) may indicate decreasing inflationary pressure, which is crucial for the Fed's future decisions.

The situation in the Persian Gulf remains tense after another American combat aircraft crashed in the region. Iran rejected the American proposal for a 48-hour ceasefire, and diplomatic efforts led by Pakistan ended in failure. Markets are concerned about the escalation of the conflict, which could affect oil prices and overall geopolitical stability. Additionally, the controversial statement by former President Trump about the possibility of opening the Strait of Hormuz only exacerbates uncertainty in the region.

Macroeconomic data from the USA and China is sending mixed signals. In the USA, the PMI for services dropped to 49.8, below expectations and the previous value of 51.1, which may suggest a slowdown in the services sector. Meanwhile, in China, the PMI for services also recorded a decline to 52.1, which is significantly below the forecasted value of 53.6. This data may indicate a deterioration in the economic condition of both countries, which in turn could affect global market sentiment.

Tomorrow, investors should pay attention to the further development of the geopolitical situation in the Persian Gulf region and any new economic data that may influence expectations regarding Fed monetary policy. Also, any new reports that could affect commodity prices, including oil, will be crucial for understanding the direction in which the markets are heading.