After US central bank officials predicted the first interest rate hike after the pandemic in advance, the U.S. dollar had its best week since September last year, while gold fell sharply and the stock market fell.

The U.S. dollar index, which measures the U.S. dollar against major currencies, rose 0.4% on Friday, with a weekly gain of 1.9%. Prior to this, Fed policymakers predicted on Wednesday that interest rates would rise from their earlier forecasts for 2024 to their historical lows in 2023.

Gold is priced in U.S. dollars, which is usually the opposite of the trend of the U.S. dollar. It traded at $1,773 per ounce on Friday, which has fallen by nearly 5% since Monday, marking its biggest weekly decline since March 2020.

Keith Balmer, multi-asset portfolio manager at BMO Global Asset Management, said: “Because the hawks of interest rate hike expectations have been unexpectedly advanced, you have seen the dollar’s trend quite aggressive.” “Most markets are Bearish The U.S. dollar before this meeting,” he said, because traders had expected the Fed to maintain ultra-loose monetary policy.

On Wall Street, the Standard & Poor’s 500 Index fell by 1% as the stock prices of banks, industrial companies, and energy producers fell. The technology-focused Nasdaq Composite Index fell 0.7%.

Fed officials on Wednesday improve Their median forecast of US GDP growth this year is 7%, up from 6.5% in March.

But Carmignac portfolio consultant Kevin Thozet said that as investors worry that interest rate hikes will reduce GDP in the next few years, the stocks of companies that benefit from strong economic growth, such as banks and industries, are falling.

He said that now “the relative prospects of companies that are less dependent on economic growth are more favorable.”

The Stoxx Europe 600 Index hit a record high on Wednesday, but its energy sub-index fell 2.8% and fell 1.4%. The London FTSE Index fell 1.7%, also pushed down by energy stocks.

The prospect of the Fed raising the cash rate before the European Central Bank. swear As the euro zone economy is recovering from Covid-19 more slowly than the United States, in order to keep monetary policy accommodative, the euro was hit on Friday. The euro fell 0.4% against the US dollar to 1.185 US dollars, and the exchange rate against the US dollar fell 2% this week.

The pound fell 0.8% to $1.380 against the U.S. dollar, a weekly decline of about 2%.

US government bonds rose on Friday as investors viewed earlier forecasts of US interest rate hikes as a signal that the central bank is willing to control inflation.

The yield on the benchmark 10-year U.S. Treasury bond is inversely proportional to its price, down 0.04 percentage points to 1.475%.

This yield has climbed from about 0.9% at the beginning of the year, but it has slowed down in recent months following the decision of investors leap Inflation in the United States will be short-lived. Continued inflation has eroded the fixed-rate return on bonds.

Tatjana Greil-Castro, co-head of public markets at credit investor Muzinich, said: “The narrative of the bond market has been changing at will.” “First of all, we have this idea. [coming out of the Covid-19 crisis] Inflation will always be high.Then the story is this is the top and [inflation] Will decline, and I think the story will continue to change because we don’t know yet. ”