Thursday noon trading, andstock prices have fallen for another decade. Powell acknowledged the increased risk of a recession.
The Dow Jones Industrial Average fell about 300 points, or about 1%, after the release of new inflation data. The tech-heavy Nasdaq fell by more than 180 points (about 1.6%), while the broader S&P 500 fell by about 40 points (1%). The
S&P 500 slipped into bear territory earlier this month and is defined as a 20% drop from recent highs, the worst first-half performance since 1970, according to Reuters. We are increasing the pace towards. Nasdaq is tracking towards the sharpest first-half decline on record.
According to Commerce Department data released Thursday, the Fed's recommended index for inflation, the consumer spending price index, rose 6.3% in May. Readings have shown that inflation remains a permanent threat to the economy, although it shows signs of leveling off after a few months of spikes.
"Many investors are actually starting to lose inflation data But what we found was that it was much more difficult, inflation data remained rising longer and probably not peaked, "CFRA's chief investor said. Strategist Sam Stovall toldReuters.
Private consumption, a major input to US economic activity, increased by only 0.2% in May, down from a 0.6% increase in the previous month. The rise was less than analysts expected and was the lowest so far this year. This is a sign of concern, as there is growing concern that the Fed may cause a recession due to a sharp rate hike.
Inflation-adjusted spending fell 0.4% compared to April.
"The rise in living expenses has absorbed all of the increase in purchasing power due to higher employment and higher wages in May," said Bill Adams, Chief Economist at Comerica Bank. "Americans are running fast just to maintain equality."
The Fed is scrambling to prevent inflation from settling in a wider economy. The day after warning that there was no chance other than aggressively raising interest rates, stock prices fell.
"There is a clock here," Powell said at the European Central Bank's Economic Policy Conference in Portugal. "The risk is to start moving to a higher inflation regime because of the diversity of shocks. Our job is literally to prevent it from happening and to prevent it from happening."
Powell is "certainly" FRB The "risk" that the actions of the Fed cause an economic slowdown.
Cryptocurrency prices continue to sell out in parallel with stocks. Bitcointemporarily fell below $ 19,000as investors responded to concerns about the looming economic uncertainty and the brewing liquidity crisis among major cryptocurrency companies.
Thursday's national average gasoline price remained close to $ 4.85 per gallon, below record highs ahead of a busy Independence Day weekend trip. Oil prices have also fallen, with the West Texas Intermediate Oil Benchmark down 2.85% to about $ 106 per barrel.