U.S. retail sales rose more than expected
U.S. retail sales rose more than expected in October as households bought motor vehicles and a range of other goods, pointing to sustained economic strength that could allow the Federal Reserve to raise interest rates next month.
The Commerce Department said on Tuesday retail sales increased 0.8 percent last month, also boosted by demand for building materials likely as households cleaned up and made repairs in the wake of Hurricane Matthew.
Adding to the report's bullish tone, September retail sales were revised up to show a 1.0 percent increase instead of the previously reported 0.6 percent rise. The combined September and October sales gain was the largest two-month rise since early 2014. Sales were up 4.3 percent from a year ago.
Fed won't be easily swayed from December rate hike: Rosengren
Only "significant negative news" could derail the Federal Reserve's high expectations for raising U.S. interest rates next month, a Fed official who has recently advocated for policy tightening said on Tuesday.
Boston Fed President Eric Rosengren, a historically dovish policymaker who surprised some in September when he joined the minority in advocating a rate rise, said the U.S. economy should hit its inflation goal next year and could well go too far in driving unemployment lower.
Fed Governor Tarullo Sees Reasons for Caution in Lifting Interest Rates
Federal Reserve governor Daniel Tarullo on Tuesday said the central bank should still proceed cautiously as it decides whether to lift interest rates despite stronger recent data.
The Fed’s regulatory point man said that while data over the last several months has shown actual inflation rising, moderately higher wage growth, and slightly higher labor-force participation than had been expected, the central bank should continue to proceed slowly in lifting rates. The Fed is scheduled to hold its next meeting of the policy setting Federal Open Market Committee on Dec. 13-14.
“The discussion of when is the appropriate moment for raising rates in order to prevent the economy from overheating too much -- is now from my point of view -- more on the table than it may have been before,” Mr. Tarullo said at The Wall Street Journal’s CEO Council. Grounds for caution, he said, include the continued slack in the labor market and the concern that the central bank has “fewer tools” to respond to a recession.
Fed's Fischer says was surprised by U.S. election outcome and ‘flash’ market events may happen more often
Federal Reserve Vice Chair Stanley Fischer said on Tuesday that he was surprised by the outcome of the U.S. presidential election.
"If the question is were you surprised by the situation in the world on Wednesday...versus where it was two days before, the answer is yes," the central bank's second-in-command said at an event at the Brookings Institution in Washington.
U.S. capital market liquidity is mostly adequate, Federal Reserve Vice Chair Stanley Fischer said Tuesday, but markets and regulations are changing and flash events could happen more frequently as a result.
Speaking at an event at the Brookings Institution, Fischer acknowledged some of the concerns about liquidity that have dogged the bond market .
Oil Jumps Most in Seven Months as OPEC Members Seen Pushing Deal
Oil surged the most in seven months as OPEC members were said to be making a final diplomatic push toward securing a deal to cut output.
West Texas Intermediate oil rose 5.8 percent on Tuesday, rebounding from an eight-week low. Qatar, Algeria and Venezuela are leading the effort to finalize a deal, a delegate familiar with the talks said. Speculators raised short positions, or bets on lower prices, by the most in more than four years in the week ended Nov. 8, Commodity Futures Trading Commission data show. U.S. crude supplies probably rose last week, according to a Bloomberg survey before a government report Wednesday. Industry data showed a gain Tuesday.
WTI for December delivery rose $2.49 to settle at $45.81 a barrel on the New York Mercantile Exchange. Prices dropped 9 cents to $43.32 on Monday, the lowest close since Sept. 19. Total volume traded was 41 percent above the 100-day average at 4:36 p.m.
Reference: Reuters, MarketWatch, Wall Street Journal, Bloomberg
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