Macro Roundup (Aug 26)

SHANGHAI, Aug 26 —This is a roundup of global macroeconomic news last night and what is expected today.

The dollar index and the euro both slipped on Thursday in choppy trading as investors waited on a speech by Federal Reserve Chairman Jerome Powell on Friday for further clues about the ongoing pace of the U.S. central bank’s rate hikes.

Investors are tossing up between the likelihood of a 50 or 75 basis point rate increase in September as the Fed battles inflation, but also faces some softening U.S. economic data.

Kansas City Fed President Esther George said it was too soon to predict by how much the U.S. central bank would raise interest rates next month, with key reports on inflation and the labor market still to come.

Atlanta Fed President Raphael Bostic also said he hasn’t decided if the Fed should increase interest rates by 50 basis points or 75 basis points at its policy meeting next month.

Fed funds futures traders are pricing in a 59% chance that the Fed will hike rates by another 75 basis points at its September meeting, and a 41% probability of a 50 basis point increase.

Stock futures dipped slightly Thursday evening as investors looked ahead to Federal Reserve Chair Jerome Powell’s speech in Jackson Hole, Wyoming Friday morning.

Futures tied to the Dow Jones Industrial Average fell 63 points. S&P 500 futures lost 0.2% and Nasdaq 100 futures slipped by 0.1%.

The moves followed an up day for the major averages in which the Dow jumped about 300 points, and the S&P 500 gained 1.4%. The Nasdaq Composite was the outperformer, advancing 1.7% as a pullback in yields helped tech shares.

Nevertheless, all the major averages are on pace for their second straight down week. The Dow is on track for a 1.2% decline. The S&P 500 and Nasdaq Composite are heading to slightly smaller declines of 0.7% and 0.5%, respectively.

Oil prices slumped by about $2 a barrel on Thursday in volatile trade as investors braced for the possible return to global markets of sanctioned Iranian oil exports and on worries that rising U.S. interest rates would weaken fuel demand.

Brent crude settled at $99.34 a barrel, shedding $1.88, or 1.9%. U.S. West Texas Intermediate crude settled at $92.52 a barrel, losing $2.37, or 2.5%.

Gold rose on Thursday as the dollar slipped from recent highs, while investors awaited the Jackson Hole symposium for cues on the Federal Reserve’s monetary policy.

Spot gold rose 0.37% to $1,757.4434 per ounce. U.S. gold futures were .53%% higher at $1,770.80.

The pan-European Stoxx 600 index ended the day up 0.3%, following a mixed day’s trade. Oil and gas stocks climbed 1.1% while retail stocks fell 2%.