Russian-Ukrainian War
In the past few months, the Russian-Ukrainian conflict has escalated. This conflict is not only a military conflict between Russia and Ukraine, but also an economic war between Russia and the United States and its allies. Following the outbreak of the war, several rounds of economic sanctions have been imposed on Russia by the United States and Europe. The chain reaction of the war and economic sanctions resulted in large fluctuations in the stock market, foreign exchange market, energy, agriculture, and precious metals futures markets.
Inflation
U.S. Consumer prices accelerated in May at the fastest rate since 1981. The Bureau of Labor Statistics' May Consumer Price Index (CPI) showed a year-over-year increase of 8.6% last month, up from 8.3% in April. The biggest contributors to the latest jump in inflation were shelter, gasoline, and food, according to the BLS.
Recession
Traders are slashing their bets on how far central banks will be able to lift interest rates this cycle, reflecting growing fears in financial markets of economic slowdown or even outright recession.higher interest rates mean higher borrowing costs . Consumption and investment will slow down, and unemployment rates may rise.People will eventually start spending less. The demand for goods and services will then drop .According to a forecast published by Bloomberg, the probability of a recession by early 2024 has reached 72%.
Fed hikes interest rate
The Federal Reserve launched its biggest broadside yet against inflation. On May 4, the U.S. Fed raised its interest rate by 0.5% to 0.75%-1.0%, becoming the largest interest rate hike since 2000. On June 15, the Fed hiked its benchmark benchmark interest rates by 75 basis points to a range of 1.5%-1.75% in June, and Chair Jerome Powell indicated there could be another similar move in July. From November highs, the S&P 500 is down more than 20%, while the Nasdaq-100 has fallen 30%.
Oil Prices
U.S. Crude oil prices turned negative for the first time, as dismal company earnings reports underlined worries about economic damage from the coronavirus pandemic. Under normal circumstances, with the Federal Reserve's rate rise cycle beginning, crude oil and other commodity prices will fall in the coming year. However, affected by the energy crisis caused by the Russian-Ukrainian War , crude oil prices rose again, and the price of WTI crude oil futures even exceeded 130 US dollars.
Algorithmic Stablecoins Crashed
You may have heard of algorithmic stablecoins. Rather than maintaining a peg by the use of a reserve of assets, TerraUSD aims to mimic the U.S. dollar and maintain stability through a complex algorithm. However, the algorithm failed and caused TerraUSD to lose its peg and collapse. As a result, the Luna fell to zero in May and even the cryptocurrency market crashed.
Proposed Acquisition of Twitter by Elon Musk
On April 14, Elon Musk offered to purchase social media company Twitter, Inc., for $44billion, after previously acquiring 9.1 percent of the company's stock for $2.64 billion, becoming its largest shareholder. Twitter adopted a limited duration shareholder rights plan, often called a “poison pill,” a day after billionaire Elon Musk offered to buy Twitter. on June 21 Musk reiterated that there are still “unresolved matters” for the Twitter deal.
Drop COVID Testing for Incoming International Air Travelers
The United States rescinded a 17-month-old requirement that people arriving in the country by air test negative for COVID-19, a move that follows intense lobbying by airlines and the travel industry.Many countries in Europe and elsewhere have also dropped testing requirements. Dropping these requirements will boost travel.
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