European stock markets fell as data expected by traders shows a continued rise in inflation in the United States that could rattle the Federal Reserve towards a monetary policy tightening eased by the pandemic.
The Europe 600 Stocks index fell 0.3%, but in the region Economic rebound from the coronavirus crisis. London’s FTSE 100 fell 0.5% and Germany’s Xetra Dax fell 0.2%.
Futures markets have suggested the Wall Street S&P 500 will trade flat at the start of the New York session.
Economists polled by Bloomberg’s forecast data released Tuesday night said headlines for U.S. consumer prices in August were up 5.3% from the same period last year, l inflation rising 5% for the third consecutive month. Indicates that the value has been exceeded.
The Federal Reserve does not expect to raise interest rates from current lows until 2023. Central Bank Chairman Jay Powell says rising inflation has caused a shortage of chips computer science. Suspension of shipment.
However, according to a survey by the Federal Reserve Bank of New York, American households now estimate that inflation will reach 5.2% within a year, well above the central bank’s target of an increase. average price of 2%. ..
Brent crude, the benchmark for oil on Tuesday, rose 0.8% to $ 74.11 a barrel, heading for the third consecutive day of gains.
Recent U.S. central bank officials have shown willingness to cut back on the Fed’s monthly $ 120 billion bond purchases during a pandemic in order to lower borrowing costs and increase lending and spending.
Rebecca Chesworth, Head of Equity for State Street’s SPDRTF business, said:
She added that the reduction in bond purchases by the US Federal Reserve was widely expected.
Yields on 10-year treasury bills, which are inversely proportional to the price of government debt securities and affect borrowing costs around the world, rose 0.02 percentage points to 1.343%. The comparable yield on the German Bund rose 0.02 percentage point to minus 0.303%.
The dollar index, which measures the US currency against the other six, fell 0.2%. The pound sterling then appreciated 0.3% against the dollar at 1.3873 dollars. Employment data Just as the government prepares to withdraw wage subsidies linked to the pandemic, it has shown that UK employers are rushing to hire new staff.
In Asia, the Hong Kong Hansen Index fell 1.4% after falling 1.5% on Monday due to the Chinese government’s crackdown on the tech and gaming industries and stress in the housing market in the United States. country.
The Beijing government dismantled payments giant Alipay while dealing with the debt crisis, China’s leading real estate developer Evergrande.
Chesworth called it “strange” that the Western stock market has not reacted more strongly to the situation in China.
“Considering the number of times I’ve spoken to clients who buy into the company for exposure to China, but I don’t see the opposite,” she said.
European stocks dip as investors bet on continued high US inflation Source link European stocks dip as investors bet on still high US inflation