The United States economy has showcased remarkable resilience, boasting a 2.4% growth in the second quarter. This impressive figure has not only surpassed economists’ projections but has also alleviated concerns of a potential recession amid rate increases. As a result, global equity markets experienced a sharp decline, while the dollar saw a significant boost.

To address the surging consumer prices, the Federal Reserve took decisive action and raised its benchmark interest rate by 25 basis points, establishing a new range of 5.25 percent to 5.50 percent. This move reflects the central bank’s commitment to controlling inflation and stabilizing the nation’s economic trajectory.

Following suit, the European Central Bank also made a similar decision to curb inflationary pressures by increasing its primary reference rate by 25 basis points, setting it at 3.75 percent. These coordinated efforts by both central banks indicate a unified approach to combatting inflation on the global stage.

However, despite the overall positive economic outlook, the MSCI world equity index witnessed a slight dip of 0.27 percent from a 15-month high. This decline was particularly evident in sectors such as finance, healthcare, technology, and consumer discretionary, which led to the Dow and S&P 500 ending lower. This market correction marked an end to their 13-day winning streak.

Contrastingly, European stocks experienced a surge, with Italian and Spanish equities reaching their highest levels in years. This uptrend reflects the market’s confidence in the region’s economic prospects amid the global recovery.

As the dollar index rose by an impressive 0.682%, the euro bore the brunt of the surge, falling by 1.05% to $1.0967. The drop came in response to the European Central Bank president’s comments on consumer price control, signaling concerns over the region’s ability to manage inflationary pressures.

The GDP data also had a significant impact on U.S. Treasury yields, with the 10-year note soaring to 4,010%, and the 2-year note reaching an impressive 4,9368%. These surges indicate investors’ response to the robust economic growth, positioning U.S. Treasury bonds as an attractive investment option.

On the commodities front, oil prices experienced an uptick, driven by supply constraints resulting from OPEC+ production cuts and growing optimism surrounding Chinese demand and global economic expansion. Brent crude settled at $84.35 per barrel, rising by 1.6%, while U.S. WTI crude settled at $80.09 per barrel, up by 1.7%.

The surge in the dollar and the surge in bond yields impacted gold prices negatively, leading to a decline of more than 1%. Spot gold fell 1.4% to $1,943.89 per ounce, and U.S. gold futures dropped 1.36% to $1,944.40 per ounce, marking a two-week low for the precious metal.