Business News

CCTV Script 17/03/16

– This is the script of CNBC's news report for China's CCTV on March 17, Thursday.

Welcome to CNBC Business Daily, I'm Qian Chen.

The Fed left rates unchanged at between 0.25 percent and 0.5 percent at its March meeting and cut its projection for the number of 2016 rate hikes from four to two, and projected just two hikes in 2017.

We made this WALL of Fed's words cloud, to see that matters the most to the FED.

"Inflation" - of course, tops the No.1 issue.

Recent economic reports have showed signs of inflation picking up. The Labor Department on Wednesday said the consumer price index, ex-food and energy, rose 2.3 percent over the 12 months through February, Reuters reported.

However, in her news conference Wednesday afternoon, Yellen said, "There may be some transitory factors influencing" the recent rise in inflation.

Then, "economic" - with the unemployment rate keeping falling and labor market participation rate getting higher, it remains debatable how the US economy is really doing.

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[LINDSEY (t) PIEGZA Stifel Nicolaus Chief Economist] "062646 we consistently see individuals with significant number of potential income earning years still left, dropping out of the market place. So these are 20+, 30+, these are not Americans that are at or near retirement age, so I think the drop out in the participation rate is really hurting the labor market recovery. We also see employers, still very certained about recovery, increasing relying on part-time, temporary, low-wage employees. So that too is restraining upward wage pressures. 062718"

Many believed the FED did sound more dovish than they previously expected, pushing stocks, gold and oil higher, while weakending the greenback. The trade on gold is pretty interestisng overnight.

Data tell us that there's been reason in recent history to stay out of gold - or, in the least, sit on the sidelines - in the immediate aftermath of an FOMC statement during the Yellen era.

Data from Kensho, which runs historical analysis of trade scenarios, showed in the one, two and three trading days after an FOMC statement since Janet Yellen became Fed chair, gold exchange-traded funds (ETF) and gold miner exchange-traded funds traded negative to a limited degree.

The major gold etfs, SPDR Gold (GLD) and iShares Gold (IAU), were both negative by on average 0.50 percent in the three days after FOMC statements dating back to March 2014. For gold mining ETFs, such as Market Vectors Gold Miners (GDX) and iShares MSCI Global Gold Miners (RING), the post-FOMC immediate return was roughly three times as bad, at negative 1.4 percent, which is not surprising, since this niche is more or less a leveraged bet on the performance of the precious metal.

Back to the FED itself, uncertainty over how many times the Fed would hike rates this year has weighed on markets since the central bank raised them for the first time in almost nine years in December.

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[DAVID (t) GARRITY GVA Research LLC Principal] "People need to look historically. Typically, the Fed has gotten out of the market, has not changed the interest rates going to the presidential election, so I think the market's view, June is gonna be the last increase, is quite appropriate, the next increase after that will come after the Nov election. Most likely in December."

The Fed will likely remain in the spotlight Thursday as a handful of secondary data reports are the major events on the calendar.

The data releases due Thursday include Fed Chair Janet Yellen's preferred indicator on the labor market, the Job Openings and Labor Turnover Survey for January.

CNBC's Qian Chen, reporting from Singapore.

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