A woman uses a smartphone in front of an electronic stock indicator of a securities firm in Tokyo Wednesday Feb. 28 2018. Asian shares slid in subdued trading Wednesday after the head of the U.S. Federal Reserve said that he's feeling more optimistic
Core PCE rose 0.3%, month over month, bringing it to 1.5% year over year.
It was Powell's first congressional appearance since becoming chairman of the Federal Reserve on February 5. The moderate wage growth is one of the signs for the labor market slackness.
It first sent the US Dollar and American bond yields surging and then sank US stock markets, which inevitably spilled over into global markets.
However, that projection came before Congress passed a $1.5 trillion tax cut in late December and a boost of $300 billion in domestic and military spending as part of a budget deal reached in January.
The Fed's job is to strike a balance between two goals: maximum employment and low inflation. This triggered concerns that inflation was imminent, and that the Fed would institute interest rate increases which would slow the economy.
Lawmakers will have the ample opportunity for questions so markets will listening closely to Powell's responses.
"That's a good first indicator for next week's payrolls, but the services ISM is more important in that regard", says Andrew Grantham, an economist at CIBC Capital Markets.
"The above consensus headline and prices paid data should support the US Dollar and weigh on fixed income".
On the data front we have the latest manufacturing PMI for February which is expected to slip back slightly from January's 55.3 to 55.1.
Top Performer of the day: Twenty-First Century Fox, Inc. (NASDAQ:FOXA)
The company has a market cap of $67,890.00, a price-to-earnings ratio of 25.39, a P/E/G ratio of 1.94 and a beta of 1.42. The company's Average Earnings Estimate for the Current Fiscal quarter is $0.57, according to consensus of 9 analysts .
Meghalaya Poll Results: Over 15000 people get 'early voter medals' in Meghalaya
The Congress - ruling the State for a decade - has fielded candidates in all 60 seats, of which 59 saw polling on Tuesday. This year's polling percentage is expected to go up further after voting in Williamnagar constituency, he said.
Jalek Felton's career at UNC is over. Here's the social media reaction
It categorized it as a "misconduct case". "It's time for a new dream", Felton said in the statement on Twitter. The freshman has been off campus since his suspension was announced before a game against Clemson.
"As we head into Fed Chair Powell's second day of testimony, USA equities have remained under pressure, despite bond yields rising", says Robin Wilkin, a global cross asset strategist at Lloyds Banking Group.
The unemployment rate in US has dropped to 4.1 percent, which Powell considered a level "at or near or even below most estimates of the natural rate of unemployment".
Like other Fed officials, Powell said he was surprised inflation and wage gains haven't been more evident, as the economy recovered from the global recession and unemployment dropped to a 17-year low of 4.1 percent. "In the (FOMC's) view, further gradual rate increases in the federal funds rate will best promote attainment of both of our objectives".
Any comments from the Fed chairman about inflation are sure to create heightened interest among observers, since the Federal Reserve makes a point of adjusting interest rates according to the inflation rate, either to stimulate economic growth through lower interest rates or to hold down prices through higher rates. Those comments rekindled speculation in the equity markets about the pace of United States monetary tightening this year being more rapid than expected, amid concerns that higher borrowing rates could crimp corporate activity and cool economic growth. U.S. stocks took another heavy beating last night on worries about rising USA interest rates.
Philip Shaw, chief economist at Investec in London said Powell's testimony was unlikely to change from the one he delivered on Tuesday, putting the focus on the question and answer session.
"In addition to that there are the USA government's protectionist measures - today it may announce import duties on steel and aluminium - and the inflation fears are no longer that far-fetched".
Trump told industry executives Thursday he would impose the tariffs next week. Both these factors are expected to boost USA economic numbers in the quarters ahead.
The dollar index, which measures the greenback against a basket of major currencies, was up 0.1 percent at 90.700.
Recommended News
-
02 March 2018South Korea: US, North Korea should lower bar for discussions
Moon met Kim for about an hour beginning 5 p.m. (0800 GMT) in Pyeongchang , the presidential office said without elaborating. During the meeting, Kim expressed the North's willingness to talk to USA officials, according to Moon's office.
02 March 2018James Harden Steals Wesley Johnson's Soul With Epic Ankle-Breaker
As Johnson recovered a full 10 feet in front of Harden with 15 seconds left on the shot clock, the Houston Rockets' guard paused. Now, most players would gather and shoot knowing that they're about to go viral and make the highlights for the night.
02 March 2018Hawkeyes Advance in B1G Tournament with Win Against Illinois
The Michigan State Spartans have won 16 games in a row and are ranked 2 in the country heading into the Big Ten Tournament . An NCAA tournament regular, it had its own injury issues to deal with this season and dropped to the second division. -
What to watch for at the 2018 Oscars
And Timothée Chalamet, who's nominated for " Call Me by Your Name " could become the youngest best-actor victor . Greta Gerwig is the first woman to receive a directing nomination for her directorial debut ( Lady Bird ).
02 March 2018Talent Students Fight Back Against Threats of Violence
The district said incidents of threats made at other schools over the last two weeks are still under investigation. The school district's superintendent says all the children are accounted for and safe within the building.
02 March 2018Top US envoy on N. Korean nukes to retire this week
Career State Department employee Joseph Yun is formally retiring at the end of this week. He also said Secretary of State Rex Tillerson had accepted his resignation. -
02 March 2018Warner and Smith keep Aussies in hunt
Then Marsh defended an innocuous ball accounting for turn, but it held its line and took his outside edge to the same position. But there is plenty yet to do. "Kingsmead ( Durban ) is a wicket where if you stop the scoring something will happen".
02 March 2018Nonsmokers think their co-workers smoke breaks aren't fair, survey says
Ultimately, 82% of employees across all industries agreed that incentives to quit were a good idea. Women would quit for an extra 11 days off, while men would quit for an extra 12 days of leisure.
02 March 2018Jaguar i-Pace Electric SUV is OFFICIALLY revealed
The I-PACE will get an eight-year battery warranty (up to 100,000 miles) and 21,000-mile/two-year servicing intervals. Inside, the Jaguar I-Pace has a slight advantage in head and shoulder room, but actually is a tad tight on legroom. -
02 March 2018Senate Intel Committee Finds House Intel GOPers Leaked Warner Texts
Burr and Warner told the Times in a joint statement that they did meet with Ryan but did not request any specific action. Taken together, the actions suggested a pattern of partisanship and unilateral action by the once-bipartisan House panel.
02 March 2018Why Neymar's Injury Won't Doom Brazil's Hopes Of Winning World Cup 2018
Brazil's national team doctor, Rodrigo Lasmar, says "it was not a simple fissure in his little toe". But on Sunday he looked to be in tears as he was stretchered off the field at the Parc des Princes.
02 March 2018Trump 2020 might be Kushner's escape hatch
The past 24 hours have rocked the foundation of the inner circle of confidants and senior White House staff that U.S. Kushner Companies spokeswoman Christine Taylor also denied that Kushner played a role in obtaining the loans.
