SINGAPORE/TOKYO, Sept 13 The dollar inched higher against the yen on Tuesday but remained below the previous day’s high, having taken a hit after dovish comments from a Federal Reserve policymaker reduced bets that the Fed would raise interest rates this month. The companies value their combined business at $36 billion, and they expect the deal to close in the middle of next year. “It may require a relatively more modest adjustment in the policy rate to return to neutral over time than previously anticipated”.
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Federal Reserve governor Lael Brainard on Monday urged “prudence in the removal of policy accommodation”, arguing that improvement in the labor market hasn’t had the desired effect on inflation.
Brainard said ultra-loose monetary policy “has served us well in recent months, helping to support continued gains in employment and progress on inflation”.
Viewed as an influential voice of caution within the Fed’s Washington-based board of governors, Brainard was the U.S. Treasury’s undersecretary for global affairs from 2010 to 2013. Some analysts said Rosengren’s upbeat comments have set the stage for something similar from Brainard, despite subdued data.
E-mini futures on the S&P 500 slipped 0.4 percent after the underlying gauge rallied 1.5 percent on Monday, recouping some of Friday’s 2.4 percent slump.
Two other Fed officials also indicated that they’re in no hurry to raise short-term interest rates at their September 20-21 meeting, helping spur a broader bounce-back on Wall Street overnight.
Boston Fed President Eric Rosengren said in a speech last week that low interest rates are increasing the chance of overheating the US economy.
But other Fed officials are ready to talk about a rate hike.
Republican Presidential candidate Donald Trump accused the Fed on Monday of keepinginterest rates low because of political pressure from the Obama administration.
Air New Zealand and Tower Ltd were among the biggest gainers on the benchmark index, both climbing more than 2 percent.
Lockhart isn’t among the 10 voting members of the Fed’s interest-rate setting panel this year.
However, when pressed for further indications as to the possible timing of the Fed’s next hike he refused to be drawn, reportedly answering: “Financial markets seem to be very sensitive to remarks of Fed speakers at the moment”.
Employers have added a solid 204,000 jobs a month over the past year.
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There was limited market reaction to the latest Chinese economic data, which provided further signs of an improvement in China’s economic activity. Platinum was little changed at $1,055.77 an ounce while palladium was 0.1 percent higher.
