Yahoo Finance
NEW YORK (AP) —The bond marketswung Friday as investors built bets thatthe Federal Reservemay hike interest rates soon to get the nation'shigh inflationunder control.
stocks, meanwhile, dipped but not by much after economists said a speech by Chairman Kevin Warsh helped strengthen faith that the Fed will do what's needed to bring inflation down, even if it causes pain for the economy in the short term.
The S&P 500 fell 0.2% after flipping between modest gains and losses through the morning.
The Dow Jones Industrial Average dipped 9 points, or less than 0.1%, and the Nasdaq composite slipped 0.5%.
The reaction was stronger in the bond market following Warsh's first speech as chairman of the Fed at an annual economic symposium held in Jackson Hole, Wyoming.
The mountain setting has been the backdrop for major Fed policy announcements in the past, and the pressure was on Warsh.
Worries had grown that his tough talk about getting inflation down to the Fed's 2% target may be just that, unless the Fed backs it up with action.
The Fed could hike short-term interest rates to get inflation under control, but it could also feel deterred from doing so because that would slow the economy and hurt prices for investments.
And President Donald Trump, who appointed Warsh, has been vocal about wanting interest rates to be lower rather than higher.
Warsh was adamant again on Friday that he wants to give financial markets fewer clues about what the Fed plans to do with rates for its two jobs of keepinginflationlow andthe job marketstrong.
He has said he wants markets to react to what incoming data says about the economy and inflation rather than what the Fed says.
But Warsh also said Friday that "short-term interest rates are the predominant tool" for the Fed to do its job.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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