Macro Roundup (Jun 23)

SHANGHAI, Jun 23 —This is a roundup of global macroeconomic news last night and what is expected today.

The dollar eased against the euro and yen on Wednesday as concerns mounted that interest rate hikes by major central banks to contain inflation run the risk of inducing a sharp global slowdown or recession.

British consumer price inflation hit a new 40-year high at 9.1% in May, while annual Canadian inflation surged to 7.7% last month to the highest rate since January 1983, in the latest data to show consumer prices running hotter than expected.

Sterling initially lost almost 1% as it fell to a near one-week low of $1.2162, but it later pared losses. The Canadian dollar slid against the U.S. currency, but it remained below the 1.30 level it breeched last Friday and on Monday.

S&P 500 futures rose Wednesday night after the major indexes slipped into the red at the end of regular trading and investors weighed the likelihood of a recession after Federal Reserve chair Jerome Powell acknowledged it’s a possibility.

Futures tied to the S&P 500 advanced 0.27%, while the Dow Jones Industrial Average futures gained 0.23% or 71 points. Nasdaq 100 futures added 0.33%.

In regular trading, the Dow retreated 47.12 points, or 0.15%, in the final hour of the session, after rallying to start the day. The S&P 500 fell 0.13% and the Nasdaq Composite lost 0.15%.

The moves came after Federal Reserve chair Jerome Powell told Congress the central bank is “strongly committed” to bringing down inflation. He also noted that a recession is a “possibility,” a fear that has continued to weigh on Wall Street.

Oil prices tumbled around 3% on Wednesday as investors worried that rate hikes by the Federal Reserve could push the U.S. economy into recession, dampening demand for fuel.

Brent crude futures fell $2.91, or 2.5%, to settle at $111.74 a barrel. The global benchmark hit a session low of $107.03, its lowest since May 19.

U.S. West Texas Intermediate (WTI) fell $3.33, or 3%, to settle at $106.19 a barrel. The session low was $101.53, its lowest since May 11.

Gold rose on Wednesday as renewed fears of a recession bolstered bullion’s allure as a safe haven and countered pressure from a firmer dollar, while investors awaited monetary policy cues from the Federal Reserve.

Spot gold reversed initial declines to rise 0.4% to $1,839.86 per ounce by 1145 GMT, while U.S. gold futures gained 0.2% to $1,841.70.

The pan-European Stoxx 600 provisionally ended down 0.7%, with basic resources sliding 5% to lead losses as most sectors and major bourses ended in negative territory.