Rate Hike Looms as Oil Prices Surge Ahead of Fed Meeting
The US Federal Reserve's policy meeting on Wednesday is expected to deliver a rate hike amid rising oil prices and bond yields. Stocks on Wall Street extended their decline ahead of the meeting, with the Dow Jones Industrial Average slipping 0.7%, the S&P 500 down 0.5%, and the Nasdaq Composite falling 0.8%. The yield on US 10-year treasuries hit 5.04% before settling back to 5% at 7am, while New Zealand's equivalent was at 5.05%.
The closure of a key pipeline in Saudi Arabia put pressure on the Middle East nation, which throttled back production to its lowest level in decades, driving up Brent crude oil futures to US$108.69 a barrel. Energy companies such as ExxonMobil Holdings, Chevron Corp, and Occidental Petroleum gained amid the increase in oil prices.
The US Senate blocked digital asset structure legislation that would have brought crypto into the mainstream by making the Commodity Futures Trading Commission its primary regulator, causing Bitcoin to drop 3.8% to US$75,966. Artificial intelligence giants OpenAI, Anthropic, and Google DeepMind are working together on steps to address safety concerns after fears emerged over whether self-improving models were developing at too fast a pace for humans to keep control of them.