Macro Roundup (Nov 29)

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

The dollar clawed back from earlier losses on Monday as a hawkish Federal Reserve official laid out the case for further rate hikes, while the Australian dollar sank on concerns about unrest over COVID restrictions in China.

The greenback rebounded in early U.S. trading and added to gains after St. Louis Fed President James Bullard said that the U.S. central bank needs to raise interest rates quite a bit further and then hold them there throughout next year and into 2024 to gain control of inflation and bring it back down toward the Fed’s 2% goal.

Comments from Fed Chair Jerome Powell on Wednesday will be watched for any new signals on further tightening with key U.S. jobs data for November also due on Friday. The U.S. central bank is expected to hike rates by an additional 50 basis points when it meets on Dec. 13-14.

The dollar index has fallen to 106.67 from a 20-year high of 114.78 on Sept. 28 on expectations that its rally may have been overstretched and as the Fed looks to slow its pace of rate increases.

U.S. stock futures were flat on Monday night after the major averages came under pressure from Covid protests in China, and as investors anticipated more economic data and commentary from Federal Reserve leaders this week.

Dow Jones Industrial Average futures fell by 5 points, or 0.02%. S&P 500 and Nasdaq 100 futures climbed 0.04% and 0.05%, respectively.

The Dow Jones Industrial Average lost 497.57 points, or 1.45%, during the regular session Monday. The S&P 500 slid 1.54%, while the Nasdaq Composite closed down 1.58%.

Global oil benchmarks pulled back from their lowest levels in nearly a year on Monday, with U.S. crude ending positive, bolstered by talk of an OPEC+ production cut that offset concerns about strict COVID-19 curbs in China, the world’s biggest crude importer.

Price action was volatile. U.S. West Texas Intermediate (WTI) crude settled up 96 cents, or 1.3%, at $77.24, after earlier touching its lowest since December 2021 at $73.60.

Brent crude also briefly turned positive, but settled down 44 cents, or 0.5%, at trade at $83.19 a barrel, having slumped more than 3% to $80.61 earlier in the session for its lowest since Jan. 4, 2022.

Gold prices slipped from a more than one-week high on Monday, as the dollar rose from session lows on hawkish comments from members of the U.S. Federal Reserve reiterating their fight against inflation.

Spot gold last fell 0.86% to $1,740.557 per ounce, after hitting its highest since Nov. 18 earlier in the day. U.S. gold futures settled down 0.8% at $1,740.3.

The pan-European Stoxx 600 was down 0.7% by the market close, with oil and gas stocks shedding 1.4% to lead losses as most sectors and major bourses closed in the red.