Dow trades at record high, oil gains as Hurricane Barry threatens Gulf Coast
Ipek Ozkardeskaya of MBAex - InsideFutures.com - Fri Jul 12, 12:54AM CDT

The US stocks went to the moon and back as the Federal Reserve (Fed) Governor Jerome Powell strongly hinted that an interest rate cut is imminent at his semiannual testimony before the congress. The global economic slowdown outweighs the good data in the US, according to Powell. Also, the Feds chief thinks that the relationship between jobs and inflation weakened over time, meaning that a solid labour market would not necessarily mean a stronger inflation outlook. In other words, the fact that the US unemployment rate stands at a fifty-year low will not hold the Fed back from lowering the interest rates. With one remark though. The US core inflation rose from 2.0% to 2.1% y-o-y in June, even though the headline inflation eased from 1.8% to 1.6% y-o-y as expected by analysts.

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US June factory-gate prices are due today. A similar positive surprise may lead to a further correction in the US bond markets, but investors will keep in mind that an upturn in inflation, if not significant, will not influence the Feds dovish plans.

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https://www.lcg.com/int/analysis-education/market-reports/articles/dow-at-record-oil-up-on-hurricane-barry/

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