Wall Street has opened lower for the fourth consecutive day after minutes of the Federal Open Market Committee expressed concerns about US economic growth in an interest rate meeting. The S&P 500 dropped by 0.7%, while the Nasdaq composite lost 0.94% after the meeting was more 'dovish' than economists expected, meaning that Federal Reserve policy makers were less keen on hiking the rate than expected.
Based on an inflation rate of only 0.1% in July and the GDP growth based on the reliable Atlanta Fed's GDPNow reading at 0.7% in the third quarter, the economic recovery in the US is not lifting off as much as analysts had expected.
Augustin Eden, analyst at Accendo Markets, said: "The further we travel under current conditions, the greater the risk of market distortions and irresponsible borrowing. It could well become a case of weighing up the risk of action against that of inaction."
Ever-falling oil and commodity prices also form a threat for investors, who were shocked after analysts said that Bent crude might hit it $30, down from around $100 in more normal times.
The dollar has fallen 0.6% against the pound, down to £0.638 and, although the approval of a bailout deal for Greece, which managed to repay the European Central Bank €3.2bn on the deadline of 20 August, lifted hopes for the international economy, Asian markets are showing signs of a slowdown in growth. The Shanghai composite, Asia's main index, dropped by 1.5% on 20 August, with Asian stock markets such as the Nikkei and Hang Sheng Index all falling, increasing fear in the US.