MTS Help Center

Business activity in the U.S. mid-Atlantic region improved in August, but local employment deteriorated to its worst level in seven years, a survey from the Philadelphia Federal Reserve released on Thursday showed.

The Philadelphia Fed said its current business activity index rose to 2.0 in August from -2.9 in July. The August figure matched the median forecast among economists polled by Reuters.

A reading above zero indicates expansion in the region's manufacturing. The survey covers factories in eastern Pennsylvania, southern New Jersey and Delaware.

The normalization of monetary policy is hampered by a low neutral rate, Dallas Federal Reserve Bank President Robert Kaplan said on Thursday.

"There is room for the Fed to maneuver but not as much as people might think because the neutral rate of interest is somewhat lower than people think," Kaplan told a meeting of financial service professionals in Dallas, Texas.

"It's a challenging time," he added.

The neutral rate is the level of borrowing costs associated with stable inflation and full employment. The U.S. central bank has struggled to raise interest rates again following the first increase in a decade last December.

San Francisco Federal Reserve Bank President John Williams on Thursday joined a growing chorus of his colleagues signaling support for a U.S. interest rate hike in coming months, saying that waiting too long could be costly for the economy.

"I think every one of our meetings should be in play in principle ... I definitely think September should be," Williams told reporters after a speech here, referring to the U.S. central bank's next policy meeting. "I think that makes sense given where the economy is."

Saying he is in no hurry to raise rates, Williams nevertheless warned that the economy could overheat if rates are kept low for too long, like a party at which the host fails to remove the punch bowl.

Strong employment and a long-awaited return of middle-wage jobs suggest the labor market is tightening and the broader U.S. economy is on track, an influential Federal Reserve policymaker said on Thursday, appearing to reinforce his more confident message on a possible interest-rate hike.

New York Fed President William Dudley, a permanent voter on U.S. interest-rate policy and a close ally of Fed Chair Janet Yellen, said the last two months of employment "helped allay concerns that arose earlier this year that job growth was beginning to stall (and) reinforced my view that labor market conditions continue to improve."

Brent crude oil prices dipped in early Asian trading hours on Friday, but remained near two-month highs with Brent still holding above $50 per barrel in a bull-run that has lifted the market by over 20 percent since early August.

International benchmark Brent crude oil futures were trading at $50.80 per barrel at 8.56 p.m. ET, down 9 cents from their last close.

Oil entered a bull market, gaining for a seventh straight day, on speculation major oil producers may act to curb output.