Moderate Inflation Ahead, Tight Job Market Boosts Wages

Moderate Inflation Ahead, Tight Job Market Boosts Wages

Moderate Inflation Ahead, Tight Job Market Boosts Wages

$DIA, $SPY, $QQQ, $VXX

 The United States Steel Corporation (NYSE:X) announced plans to reopen an Illinois factory following President Donald Trump’s decision to impose a new tariff on imported steel.

A tight US labor market was helping lift wages across most of the nation through late February and contributing to “moderate inflation” in most areas, a new Fed survey showed.

The central bank’s Beige Book economic report, based on anecdotal information collected by the 12 regional Fed banks through 26 February, showed that the nation’s “modest to moderate” expansion was spreading the benefits of higher pay more widely. The survey also contained evidence that a pickup in inflation was more broadly based.

“Across the country, contacts observed persistent labor market tightness and brisk demand for qualified workers, as well as increased activity at staffing placement services,” according to the report, released Wednesday. “Most districts saw employers raise wages and expand benefit packages in response to tight labor market conditions.”

Prices increased in all districts, the survey stated, “and most reports noted moderate inflation.” The previous Beige Book report, released 17 January, noted that “most districts reported modest to moderate price growth.”

The report may add to expectations among investors that the central bank could end up raising interest rates in 2018 by more than the three quarter percentage-point moves that officials projected in December.

The rate-setting Federal Open Market Committee is scheduled to meet March 20-21, and investors widely expect the sixth increase since December 2015.

One of the Fed’s more dovish policy makers, Atlanta Fed President Raphael Bostic, said earlier Wednesday he had upgraded his own projection to three hikes this year, from two. Fed Governor Lael Brainard, another official who has argued a cautious approach to raising rates, said late Tuesday the economic outlook is improving and signaled support for continued gradual rate increases.

Wednesday, the major US stock market indexes finished at: DJIA -82.76 at 24801.36, NAS Comp +24.64 at 7396.64, S&P 500 -1.32 at 2726.80

Volume: Trade on the NYSE came in at: 840-M/shares exchanged

  • NAS Comp +6.8% YTD
  • S&P 500 +2.0% YTD
  • DJIA +0.7% YTD
  • Russell 2000: +1.7% YTD

HeffX-LTN’s Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance
7 March 2018 QQQ 168.32 Neutral (0.22) 166.19 170.31
7 March 2018 DIA 247.41 Neutral (-0.13) 246.87 249.01
7 March 2018 SPY 272.4 Neutral (0.17) 271.88 275.52

Stay tuned

 

 

The following two tabs change content below.

Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

Latest posts by Paul Ebeling (see all)

You must be logged in to post comments :  
CONNECT WITH