#XMINDO_FX Market - Aug 18 The U.S Dollar was weaker against major rivals on Friday, trading near a two-week low as it retreated from an 11-month high, after a gauge of consumer sentiment in August hit the lowest level in nine months, as a rocky stock market helped to depress expectations about the future. The preliminary August reading on the University of Michigan/Thomson Reuters consumer-sentiment index fell to 79.2, the lowest level since November, from a final July result of 81.8, according to data released Friday. A volatile stock market as well as international tensions could be weighing down sentiment. Also, an index of manufacturing conditions in the New York area continued to grow in August but at a slower pace than the four-year high reached in the prior month. The Empire State’s general business conditions fell to 14.7 in August from 25.6 in July. Other than that, U.S. producer prices inched up in July in a sign of low inflation pressure, led by services, according to government data released Friday. U.S. producer prices rose 0.1% in July, a second consecutive month of gains, the U.S. Labor Department reported. The July report for the consumer-price index is scheduled to be released next week, and economists expect this gauge to show a slower pace for overall inflation, though core price inflation may pick up. The sharp drop in the unemployment rate masks persistent weakness in the labor market, said Narayana Kocherlakota, the president of the Minneapolis Fed, on Friday. I see labor markets as remaining some way from meeting the FOMCs goal of full employment, Kocherlakota said. In his speech, Kocherlakota said the jobless rate could continue to tumble and hit 5.7% by the end of the year from 6.2% in July. But Kocherlakota said there are many ways to see this continued weakness in labor markets, saying that too many people aged 25 to 54 are not working. In addition, a historically high percentage of workers can only find part-time work even though they want full-time jobs, he said. Kocherlakota also said he expects inflation to stay below the Feds 2% target until 2018. The Feds favorite inflation measure,the personal consumption expenditures price index has averaged 1.6% since the start of the recession, he noted. With the Fed on track to end its extraordinary stimulus program in October, investors are starting to consider the effects of the first U.S. rate increase in eight years on emerging-market currencies. The Dollar Index, which tracks the performance of the U.S Dollar major currencies, was down by 0.230% at 81.425. xmindofx/market-news
Posted on: Mon, 18 Aug 2014 09:48:43 +0000
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