Fed Minutes Point to Rate Hike ‘Relatively Soon’
U.S. central bankers debating the merits of raising interest rates last month described the decision as a close call, with several saying a rate hike was needed “relatively soon,” minutes of the September meeting showed.
“Several members judged that it would be appropriate to increase the target range for the federal funds rate relatively soon if economic developments unfolded about as the committee expected,” the minutes from the Sept. 20-21 gathering in Washington showed. “It was noted that a reasonable argument could be made either for an increase at this meeting or for waiting for some additional information on the labor market and inflation.”
“The probability of a rate hike is very likely by the end of the year,” said Randall Kroszner, an economics professor at the University of Chicago Booth School of Business and a former Fed governor. “Unless there’s some major shock, I think they’re pretty much on track to move in December,” he told Bloomberg Television in an interview.
Fed’s Dudley Says ‘Go as Far as You Can’ to Expand Workforce
Federal Reserve Bank of New York President William Dudley said the U.S. central bank should continue seeking to draw Americans back into the work force as it debates raising interest rates.
“You certainly want to go as far as you can,” Dudley told the Business Council of New York State on Wednesday in Albany, New York. “You don’t want to keep people unemployed just because you think you’re already at the full employment rate."
Policy makers last month left the benchmark lending rate unchanged in a range of 0.25 percent to 0.5 percent for the sixth straight meeting, while a majority of the 17 participants forecast at least one hike this year. Following the decision, Chair Janet Yellen said she hoped keeping rates low would attract more people into work or to look for jobs.
Dollar Climbs With Stocks After Fed Minutes; Pound Snaps Selloff
Bloomberg’s dollar index, which tracks the currency against 10 major peers, rose 0.2 percent as of 5 p.m. New York time, climbing for a third straight session and reaching its highest level since March. The greenback added 0.7 percent to 104.21 yen, touching its strongest level since Sept. 2, and gained 0.4 percent to $1.1007 per euro.
Number of job openings fall in August to 5.4 million, an eight-month low
Monthly job openings fell to an eight-month low in August to 5.4 million, according to data from the Bureau of Labor Statistics on Wednesday.
That's a rate of 3.6 percent, according to the Job Openings and Labor Turnover Summary (JOLTS). Economist expected monthly job openings in August to be 5.72 million, according to estimates by Reuters, down from 5.87 million last month.
"These data can be volatile and the openings rate is still fairly high, so it is too early to tell whether this is a signal or just the noise of volatile monthly data," John Ryding, chief economist at RDQ Economics, told Reuters.
"However, if this drop is sustained, it could be a sign of increased caution on the part of businesses," he said.
Oil prices fall on higher OPEC output, rise in U.S. crude stocks
Oil prices fell on Thursday after OPEC said that its production had risen to its highest level in at least eight years and following reports of an increase in U.S. crude stockpiles.
U.S. West Texas Intermediate (WTI) crude futures were down 35 cents, or 0.7 percent, at $49.83 per barrel.
Traders said oil markets had come under pressure after Organization of the Petroleum Exporting Countries (OPEC) reported a rise in production, despite the producer cartel having plans, potentially with non-OPEC producer Russia, to cut output in a bid to rein in a global supply overhang.
Reference : Bloomberg, Reuters, CNBC
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