Macro Roundup (Aug 19)

SHANGHAI, Aug 19 —This is a roundup of global macroeconomic news last night and what is expected today.

The U.S. dollar index surged to a one-month high on Thursday as Federal Reserve officials spoke of the need for further rate hikes, and investors reevaluated Wednesday’s minutes from the U.S. central bank’s July meeting as being more hawkish than originally thought.

The Fed needs to keep raising borrowing costs to bring high inflation under control, a string of U.S. central bank officials said on Thursday, even as they debated how fast and how high to lift them.

St. Louis Fed President James Bullard said he is leaning toward supporting a third straight 75-basis-point interest rate hike in September.

San Francisco Fed President Mary Daly said hiking rates by 50 or 75 basis points next month would be a “reasonable” way to get short-term borrowing costs to “a little bit above” 3% by the end of this year, and on their way to a little bit higher in 2023.

The dollar pared gains on Wednesday after the Fed’s July meeting minutes showed central bank officials were concerned they could raise rates too far in their commitment to get inflation under control, which was interpreted as modestly dovish.

Stock futures were little changed on Thursday evening as the S&P 500 looked to grind out another positive week.

Futures for the S&P 500 were flat. Futures tied to the Nasdaq 100 the Dow Jones Industrial Average were also little changed.

The three major averages closed marginally higher on Thursday, putting the Dow and S&P 500 on track for a potential winning week. The S&P 500 is up just 0.08%, but that would still be its fifth straight positive week. The Dow is up 0.71% for the week, on track for its fourth positive week in five.

The Nasdaq Composite is down 0.63% for the week.

While this week has seen relatively muted moves on Wall Street, it comes on the heels of a solid rally since mid-June.

Oil prices gained about 4% on Thursday as positive U.S. economic data and robust U.S. fuel consumption offset concerns that slowing economic growth in other countries could undercut demand.

Brent futures rose $3.41, or 3.6%, to $97.06 a barrel, while U.S. West Texas Intermediate (WTI) crude rose $3.00, or 3.4%, to $91.11.

Prices rose more than 1% during the previous session, although Brent at one point fell to its lowest since February, as signs of a slowdown mounted in some places.

Gold prices eased on Thursday under pressure from a firmer dollar although losses were capped by a dip in Treasury yields, while investors looked for more economic cues that could influence rate hikes.

Spot gold fell 0.11% to $1,759.16 per ounce, having slipped to $1,759.17 on Wednesday, its lowest since Aug. 3. U.S. gold futures were down 0.2% at $1,773.10 per ounce.

The pan-European Stoxx 600 was up 0.3% by the end of the day, having reversed earlier losses. Oil and gas and tech added 1.7% and 1.2%, respectively, while retail stocks slid 1.5%.