Macro Roundup (Aug 29)

SHANGHAI, Aug 29 — This is a roundup of global macroeconomic news last night and what is expected today.

The dollar touched a fresh 20-year high on Monday, fuelled by hawkish comments by Federal Reserve Chair Jerome Powell, but was kept in check by the euro, which was supported by growing expectations for European Central Bank (ECB) rate hikes.

The dollar index , which measures the currency’s value against a basket of peers, scaled a fresh two-decade peak of 109.48 before retreating.

The greenback was up 0.97% against Japan’s yen, while Britain’s pound notched a fresh 2-1/2 year low in thin trading, with the UK on a public holiday.

Powell told the Jackson Hole central banking conference in Wyoming on Friday that the Fed would raise rates as high as needed to restrict growth, and would keep them there “for some time” to bring down inflation that is running at more than three times the Fed’s 2% goal.

Stock futures ticked higher on Monday evening as Wall Street sought stability after another down day for stocks.

Futures for the S&P 500 inched upward by 0.1%, while Nasdaq 100 futures also added 0.1%. Futures for the Dow Jones Industrial Average gained 43 points, or 0.1%.

The moves in futures followed a second-straight decline for the major averages. The Dow lost 184 points, or 0.57%. The S&P 500 fell 0.67% and the Nasdaq Composite sank 1.02%.

The moves in futures followed a second-straight decline for the major averages. The Dow lost 184 points, or 0.57%. The S&P 500 fell 0.67% and the Nasdaq Composite sank 1.02%.

The market has given back some of its summer gains after recent comments by Federal Reserve officials made clear that the central bank aims to continue its rate hikes, even if they cause economic pain.

Oil prices settled up more than 4% on Monday, extending last week’s gain, as potential OPEC+ output cuts and conflict in Libya helped to offset a strong U.S. dollar and a dire outlook for U.S. growth.

Saudi Arabia, top producer in the Organization of the Petroleum Exporting Countries (OPEC), last week raised the possibility of production cuts, which sources said could coincide with a boost in supply from Iran should it clinch a nuclear deal with the West.

OPEC+, comprising OPEC, Russia and allied producers, meets to set policy on Sept. 5.

Brent crude settled up $4.10, or 4.1%, at $105.09 a barrel, having risen by 4.4% last week. U.S. West Texas Intermediate (WTI) crude gained $3.95, or 4.2%, to$ 97.01, after rallying 2.5% last week.

Gold prices reversed course to trade higher on Monday as a dollar rally lost its steam, having pushed bullion to one-month lows earlier in the session after the U.S. Federal Reserve signaled higher interest rates.

Spot gold rose 0.04% to $1,737.59 per ounce. Prices touched their lowest since July 27 at $1,719.56 earlier in the session.

U.S. gold futures were last up 0.04%.

European markets were lower on Monday after U.S. Federal Reserve Chair Jerome Powell signaled higher interest rates would likely persist in a bid to tame soaring inflation.

All sectors and major bourses slipped into negative territory during morning deals in London. Tech stocks led the losses, down over 2%.