7/13/2021 7:57:26 PM GMT
Headline inflation at 5.4% is the highest in 13 years.
Core inflation rises 4.5%, largest annual rise in three decades.
Dollar and Treasury yields gain on inflation prospects.
Federal Reserve Chair Jerome Powell will testify in Congress, Wednesday and Thursday.
The largest jump in overall prices in nearly 13 years and a three decade high in core inflation will likely be uppermost on legislators minds when Federal Reserve ChairJerome Powell is questioned in Congress on Wednesday and Thursday.
The Consumer Price Index (CPI) soared 5.4% in June over a year earlier, following a 5% gain in May, reported the Bureau of Labor Statistics (BLS) on Tuesday. Analysts in the Reuters survey had forecast a slight drop to 4.9%. It was the largest annual increase since August 2008. On the month prices almost doubled the 0.5% forecast, rising 0.9% following May’s 0.6% gain.
Underemployment rate, U-6
Markets: Equities
Equities prospered with all three major US averages in positive territory. The Dow gained 152.82 points, 0.44% to 34.786.35. The S&P 500, rising for the seventh straight day, set another record at 4,352.34 up 0.75%, 32.40 points. The NASDAQ also rose to an all-time high at 14,639.33, up 116.95 points, 0.81%.
S&P 500
Stocks responded to payrolls in the middle ground of economic policy.
If job creation had been stronger, for instance over one million, credit markets might have begun speculating on an earlier Federal Reserve bond taper. The central bank has been buying $120 billion a month of Treasuries and mortgage backed securities for more than a year, essentially freezing short-term rates. Higher interest rates are the traditional central bank tool to slow economic growth andinflation.
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Gold futures are inching above the $1900.00 level for the first time since January 8, underpinned by steady-to-lower Treasury yields and a falling U.S. Dollar amid growing inflation concerns after several Federal Reserve policymakers stood firm on their dovish stance over rates.
At 06:43 GMT, August Comex gold futures are trading $1908.20, up $7.70 or +0.41%.
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