Macro Roundup (Aug 11)

SHANGHAI, Aug 11 —This is a roundup of global macroeconomic news last night and what is expected today.

The dollar fell broadly on Wednesday, with its biggest decline against the yen since March 2020, following a cooler-than-expected inflation report for July that raised expectations of a less aggressive rate hike cycle than previously anticipated from the U.S. Federal Reserve.

U.S. consumer prices did not rise in July as the cost of gasoline plunged, delivering the first notable sign of relief for Americans who have watched inflation climb over the past two years.

Economists polled by Reuters had forecast a 0.2% rise on the heels of a roughly 20% drop in the cost of gasoline.

The dollar index, which measures the currency’s value against a basket of currencies, was down 1.29% at 105.

Dow futures were flat in overnight trading on Wednesday after all the major averages posted sharp gains on the back of a better-than-expected July inflation report.

Futures tied to the Dow Jones added 0.02% or 6 points, while S&P 500 futures and Nasdaq 100 futures inched 0.07% and 0.13% lower, respectively.

Wednesday’s regular trading session saw all the major indexes rally, with the Dow Jones Industrial Average jumping 535.10 points, or 1.63%, to close at 33,309.51. The S&P 500 added 2.13% to 4,210.24 and hit its highest level since early May, while the Nasdaq Composite gained 2.89% to 12,854.80, its highest close since late April.

Oil prices rose on Wednesday, rebounding from losses early in the session on lift from encouraging figures on U.S. gasoline demand and as a lower-than-expected U.S. inflation figure drove investors into riskier assets.

Brent crude futures rose 68 cents, or 0.7%, to $96.99 a barrel. U.S. West Texas Intermediate crude futures gained 83 cents, or 0.9%, to $91.33.

U.S. crude oil stocks rose by 5.5 million barrels in the most recent week, the U.S. Energy Information Administration said, more than the expected increase of 73,000 barrels. However, U.S. gasoline stocks fell sharply as implied demand rose after weeks of lackluster activity during what is supposed to be peak summer driving season.

Gold prices edged up in choppy trading on Wednesday after relatively tame U.S. inflation readings prompted bets that the Federal Reserve may not opt for aggressive rate hikes.

Spot gold rose 0.2% to $1,797.29 per ounce by 10:19 ET (1419 GMT), but gave up some gains after rising to its highest since July 5 after the CPI data.

U.S. gold futures were little changed at $1,813.00.

The pan-European Stoxx 600 closed up by 1% provisionally, having earlier hovered around the flatline for much of the trading session. Retail shares climbed 3% to lead gains as almost all sectors and major bourses entered positive territory.