U S ECONOMY
Gold eases but set for weekly gain as Fed rate-cut bets boost appeal
Gold prices see a slight dip after three weeks of gains, driven by U.S. inflation data hinting at interest rate cuts. Analysts predict potential record highs as market conditions favor gold. Silver, platinum, and palladium show weekly declines amidst market uncertainties.
US economy no longer overheated, Fed's Powell tells Congress
Powell told lawmakers bluntly that "today I’m not going to be sending any signals about the timing of any future actions" on interest rates, as he was quizzed by Democrats about the risks to the job market and by Republicans about the pain to households of inflation that remains above the central bank's 2% target.
US economy no longer overheated, Fed's Powell tells Congress
Fed Chair Jerome Powell informed Congress that the U.S. job market has cooled from its pandemic extremes, indicating a stronger case for potential interest rate cuts. Powell emphasized the balance of risks the Fed now faces, highlighting recent improvements in inflation and economic conditions. Despite not signaling specific future actions, analysts suggest Powell's remarks hint at a possible rate cut as early as September. The Fed’s policy rate remains at 5.25% to 5.5% since July 2023. Powell’s semiannual Senate testimony will be followed by a House hearing on Wednesday.
Sensex rises over 200 pts, Nifty above 24,350 in hopes of dovish stance from Fed
Indian indices rose as markets expected dovish signals from U.S. Fed Chair Powell. Sensex up 223 points to 80,184, Nifty50 up 59 points. Key gainers included Maruti Suzuki, M&M, Adani Ports, while Tech Mahindra, JSW Steel fell. Soft inflation increased odds of U.S. rate cut to 74%. Century Textiles rose 4%. Budget, Q1 results closely watched.
Boeing accepts a plea deal to avoid a criminal trial over 737 Max crashes, Justice Department says
Boeing is set to plead guilty to a criminal fraud charge stemming from two 737 Max jetliners that killed 346 people, after the government determined the company violated an agreement that had protected it from prosecution for more than three years. Federal prosecutors accused Boeing of deceiving regulators who approved the airplane and pilot-training requirements for it. The plea deal, which still requires federal judge approval, calls for Boeing to pay an additional $243.6 million fine, the same amount it paid under the 2021 settlement that the Justice Department said the company breached.
Gold inches up after weak data fuels US rate cut bets
Dramatic gold price surge expected amid cautious Fed approach and weaker employment reports, signaling potential economic challenges ahead.
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Dollar on the defensive after soft data, little relief for yen
Currency markets react to global economic trends, with sterling potentially shifting leadership from Rishi Sunak to Keir Starmer in the UK.
Oil prices slip after data points to cooling U.S. economy
Amidst economic fluctuations, rate cuts could enhance demand, endorsed by ANZ Research analysts, impacting the global oil market.
Debt ceiling standoff could trigger US rating downgrade, TD's Goldberg says
Gennadiy Goldberg, head of U.S. rates strategy at TD Securities, warns of a potential severe debt ceiling standoff in the U.S. in 2025, similar to the 2011 crisis, which could lead to another sovereign credit rating downgrade. Despite Congress suspending the debt ceiling until 2025, concerns over rising U.S. debt persist following forecasts by the Congressional Budget Office of significant deficits for fiscal years 2024 and 2025.
5 world market themes for the week ahead
Central bank decisions in Britain, Switzerland, and Norway will show the rate cutting trend, while retail sales data from the US and China will indicate consumer health. Europe gears up for the Euros 2024 tournament in Germany. Investors are monitoring cocoa supply issues in Ivory Coast, Ghana, and other countries like Brazil.
Dollar stalls as market braces for CPI test, Fed outlook
The dollar steadied as market players awaited U.S. inflation data and the Federal Reserve's economic projections. The U.S. central bank's actions will impact rate cuts and economic growth prospects.
Dollar calm ahead of inflation test, Fed decision
The dollar steadied after reaching a four-week high against peer currencies as markets awaited key U.S. inflation data and the Federal Reserve's updated interest rate projections. China's economy showed signs of improvement with steady consumer inflation and narrowing producer price declines.
US stocks close slightly lower; jobs data strong but rates still high
Wall Street stocks ended slightly lower on Friday after strong U.S. jobs data raised concerns about the Federal Reserve's stance on interest rates. The Labor Department reported 272,000 jobs in May, exceeding expectations, with a 4% unemployment rate.
ECB jumps ahead of Fed, cuts interest rate by 25 bps for first time since 2019
ECB raises inflation forecast for 2024, 2025. Analysts say the quarter-point cut on Thursday would likely not usher in a swift series of further cuts as the bank waits to make sure inflation is under control while easing credit to help the economy. While inflation at an annual rate of 2.6% in May is well down from the peak of 10.6% in October 2022, the decline has slowed in recent months and inflation even ticked up slighly from 2.4% in April.
Lok Sabha Results: Coalition govt is back. Will policy paralysis too strike again?
Over the past decade, Narendra Modi has propelled India's economy to become one of the fastest-growing globally, positioning it to soon rank as the world's third-largest. His emphasis on reforms and dynamic policies, exemplified by initiatives like Make in India, has bolstered manufacturing and infrastructure growth. However, the recent Lok Sabha election results, leading to a coalition government, raise concerns about potential challenges and policy paralysis ahead. Expert analyses suggest that while coalition governments have historically been effective in driving economic growth, they have struggled to control inflation.
Yields pare losses as services sector rebounds
The business activity index is "really driving that whole index higher," said Ellis Phifer, managing director of fixed income research at Raymond James in Memphis, Tennessee.
Dollar wallows at multi-month lows as Fed cut bets grow
The dollar faced pressure as consumer price pressures stabilized, but upcoming U.S. payroll figures are being closely monitored by analysts like James Kniveton for economic strain.
Gold Rate Today: Yellow metal slips below Rs 71,300/10 grams, silver declines Rs 1370/-Kg
Gold prices declined on Monday as traders awaited further U.S. economic data following recent indications of stabilized inflation, raising expectations for a potential interest rate cut by the Federal Reserve later in the year.
Despite war needs, Israel's military should not get a 'blank check' -cenbank chief
Bank of Israel Governor Amir Yaron supported forming a committee to scrutinize Israel's defense budget, emphasizing that the ongoing war doesn't justify unchecked military spending. Since January, Yaron has advocated for fiscal adjustments to prevent budget deficits from escalating due to war costs. Prime Minister Netanyahu plans to increase defense spending by 20 billion shekels annually, despite a rising budget deficit. Finance Minister Bezalel Smotrich and Defense Minister Yoav Gallant agreed to establish the committee, aiming to balance security needs with economic stability, given the projected 250 billion shekels war cost from 2023 to 2025.
US stocks rebound to close higher but Dow down for the week
U.S. stocks rebounded on Friday with the Nasdaq reaching a record high, driven by improved consumer outlook on inflation. New orders for key U.S.-manufactured capital goods rebounded in April, and consumer inflation expectations improved. Rob Haworth from U.S. Bank Wealth Management commented on the positive data.
Fed officials urge patience on timing of initial rate cut
The timeline was echoed by Cleveland Fed President Loretta Mester in comments on Tuesday night at an Atlanta Fed conference.
Dollar set for weekly drop on US slowdown signs
It was last at $1.0861. April's annual U.S. inflation numbers met expectations but, since they were lower than the month before, they encouraged confidence that the Federal Reserve can cut interest rates in September and December - driving rallies in stocks and bonds and pressure on the dollar.
US weekly jobless claims fall; labor market gradually easing
The decline reversed a portion of the jump in the prior week, which had pushed claims to the highest level in more than eight months. The increase was largely attributed to a surge in applications in New York related to school spring breaks.
Dollar droops ahead of crucial CPI test; yen under pressure
The yen languished near a two-week low, as a still-gaping yield gap between local bonds and U.S. peers continued to encourage selling of the Japanese currency.
Fed's Powell: PPI mixed, next move unlikely to be a rate hike
Though he said "my confidence in that is not as high as it was," given faster than expected inflation through the first three months of the year, the U.S. central bank chief said it remained unlikely in his view that the Fed would have to raise rates any further, even if the prospect for rate cuts has become less certain.
US stocks edge up after 'mixed' producer inflation data, all eyes on CPI
Sticky inflation and persistent labour market strength have prompted financial markets and most economists to push back expectations for an initial Fed interest rate cut to September, from March seen at the start of the year.
Gold Price Today: Yellow metal rises to Rs 70,876/10 grams, silver at Rs 81,785/kg
Gold Price Today: Gold prices firmed on Monday as expectations that the Federal Reserve will start cutting interest rates later in the year and tensions in the Middle East boosted the allure of the non-yielding bullion.
Oil steadies, heads for weekly drop on U.S. economy worries
Brent crude futures for July rose 16 cents to $83.83 a barrel by 0008 GMT. U.S. West Texas Intermediate crude for June was up 19 cents to $79.14 per barrel.
US productivity slows sharply in first quarter
U.S. worker productivity growth slowed significantly in the first quarter, leading to a surge in labor costs, although the productivity trend remained solid. According to the Labor Department's Bureau of Labor Statistics, nonfarm productivity increased at a modest 0.3% annualized rate, down from 3.5% in the previous quarter. Economists had forecasted a higher rate of 0.8%. Productivity has risen by 2.9% compared to a year ago.
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