Fmr. Fed Governor Mishkin: CPI data should be taken with a grain of salt, here's why
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Yahoo
10 minutes ago
- Yahoo
Inflation rose 'more than expected' in July as Chancellor admits 'more to do'
INFLATION in the UK has risen by more than expected in July, according to the latest official figures. Consumer Prices Index (CPI) inflation increased to 3.8% in July, from 3.6% in June, the Office for National Statistics (ONS) said. Most economists had been forecasting inflation to rise to 3.7%. It means the headline rate remained at the highest level since January 2024, when it hit 4%. READ MORE: LIVE: Latest updates as Kneecap's Mo Chara returns to court over terror charge The ONS said transport was the biggest factor driving up overall inflation last month, particularly due to a spike in flight prices as families booked trips during the school summer holidays. Air fares soared by 30.2% between June and July, the biggest jump since the collection of monthly data began in 2001. The average price of petrol rose by 2p per litre between June and July, and the average diesel price by 2.9p per litre over the period, the data showed. Prices across UK restaurants and hotels also increased last month, largely driven by a jump in overnight hotel stays booked the night before. Food and drink inflation rose to 4.9% in July, from 4.5% in June. This marked the fourth month in a row that the annual rate had increased and remained at the highest level since February 2024. Grant Fitzner, the ONS's chief economist, said: 'The main driver was a hefty increase in air fares, the largest July rise since collection of air fares changed from quarterly to monthly in 2001. 'This increase was likely due to the timing of this year's school holidays. 'The price of petrol and diesel also increased this month, compared with a drop this time last year. 'Food price inflation continues to climb – with items such as coffee, fresh orange juice, meat and chocolate seeing the biggest rises.' READ MORE: UK Government strikes returns deal with Iraq in latest migration crackdown Meanwhile, Chancellor Rachel Reeves admitted that there was 'more to do to ease the cost of living' following the figures. She said: 'We have taken the decisions needed to stabilise the public finances, and we're a long way from the double-digit inflation we saw under the previous government, but there's more to do to ease the cost of living. 'That's why we've raised the minimum wage, extended the £3 bus fare cap, expanded free school meals to over half a million more children and are rolling out free breakfast clubs for every child in the country.'
Yahoo
an hour ago
- Yahoo
Dollar strengthens ahead of Jackson Hole, kiwi drops on dovish RBNZ
By Kevin Buckland TOKYO (Reuters) -The U.S. dollar gained for a third straight session on Wednesday against the euro and sterling as traders awaited the Federal Reserve's annual Jackson Hole symposium this week for clues on the monetary policy path. The New Zealand dollar tumbled after the central bank reduced its cash rate by a quarter point to 3.0% as expected, but said its board had also considered a half-point cut. The kiwi slumped as much as 1.3% to $0.5820, its weakest since April 14, with policymakers lowering their projected floor for the cash rate to 2.55%, from 2.85% forecast in May. "The market did not expect the bank to send a strong dovish signal that it intends to deliver further cuts," Prashant Newnaha, a rates strategist at TD Securities, wrote in a client note. He has increased his forecast for additional easing, now projecting a cash rate of 2.5% by November. The U.S. dollar index, which measures the currency against six major counterparts, rose as high as 98.441 for the first time since August 12 on Wednesday, after gaining a combined 0.4% over the first two days of the week. The euro eased 0.1% to $1.1638, and sterling slipped 0.1% to $1.3480. The greenback advanced 0.1% to 0.8080 Swiss franc, though it edged down 0.1% to 147.46 yen. Friday's speech by Fed Chair Jerome Powell is the market's main focus, as traders watch for any pushback against market pricing of a rate reduction next month. Traders now place odds of 84% on such a cut and expect about 54 basis points of reductions by year-end. "Given the relatively high bar for Powell to meet, there's a bit of risk being baked into the markets that he leans to the hawkish side and the proverbial rug gets pulled from beneath investors," said Kyle Rodda, an analyst at Traders, who ramped up bets for a Fed cut on September 17 after a surprisingly weak payrolls report at the start of this month, were further encouraged after consumer price data showed limited upward pressure from tariffs. However, a hotter-than-expected producer price reading last week complicated the policy picture. Powell has said he is reluctant to cut rates because of expected tariff-driven price pressures this summer. Later on Wednesday, the Fed will issue the minutes of its meeting on July 29 and 30, when it held rates steady, although they may offer limited insight as the meeting came before the weak jobs numbers. In cryptocurrencies, bitcoin hovered at around $113,612 after earlier dipping to the lowest since August 3 at $112,578.38, pressured by a strengthening dollar. Ether was little changed at around $4,170.
Business Insider
3 hours ago
- Business Insider
U.S. Stock Futures Down as Investors Await Fed Minutes and Retail Earnings
U.S. stock futures were down Tuesday night as investors prepared for earnings reports from major retailers and the release of the Federal Reserve's latest meeting minutes. Futures on the Nasdaq 100 (NDX), the Dow Jones Industrial Average (DJIA), and the S&P 500 Index (SPX) were down 0.05%, 0.01%, and 0.03%, respectively, at 6:38 p.m. EDT on August 19. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. This follows a mixed performance in Tuesday's regular trading session. The S&P 500 and Nasdaq Composite witnessed a 'risk-off' day, falling 0.6% and 1.5%, respectively. In contrast, the Dow managed a slight gain, boosted by a post-earnings rally in Home Depot (HD) shares. Looking ahead, investors will also be closely monitoring remarks from Fed Chair Jerome Powell on Friday for further clues on the direction of interest rates. Before the Fed minutes are released, traders will also be focused on a series of pre-market earnings reports from retail giants, including Lowe's (LOW), Target (TGT), and TJX Cos (TJX).
