In a much-scrutinized speech, Fed chief Janet Yellen on Friday hinted at a United States interest rate rise by the end of the year. She described consumer spending as “solid” but noted that US business investment was weak and exports hurt by a strong dollar.
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She said as economy and the labor market improved the case for an interest rate hike has strengthened in recent months.
Hedge funds and money managers increased their net long position in COMEX gold contracts in the week to August 23, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.
KEEPING SCORE: France’s CAC 40 lost 0.9 percent to 4,401, while Germany’s DAX fell 0.7 percent to 10,513.
Meanwhile, the Malaysian ringgit fell 0.7% against the dollar, the Indonesian Rupiah was off 0.5%, and the Australian dollar fell 0.4%.
Caesars Entertainment Corp CZR.O tumbled 15.7 percent to end at $6.35 after a US judge cleared the way for billions of dollars in bondholder lawsuits against the casino group to proceed. Vice Chair Stanley Fischer suggested on CNBC that a rate hike as soon as next month was possible.
The rate hike talk, which came out of the Fed’s central banking symposium at the end of last week, sent the dollar up past 102 yen, after having dropped to 99.9 yen last week. Asked whether there could be a rate hike next month and more than one this year, Fischer said that Yellen’s comments were “consistent with answering yes to both” of the questions. It extended those gains by 0.1 percent to 101.99 yen early on Monday. S&P 500 futures were down 0.1 percent to 2,166.50.
Monday, the stock market rebounded after economic data showed that US consumer spending increased for a fourth straight month in July, partially due a strong demand for automobiles.
The odds of a rise in September increased to 33 percent following the opinions, from 21 percent on Thursday, in accordance with CME Group’s FedWatch tool.
Overall trade in European markets was subdued with London closed for a public holiday.
Global benchmark Brent crude retreated 1.2 per cent to $49.31.
In commodities, the rally in the dollar drove crude lower.
Stock trading volume was the weakest so far this year at just below 5 billion shares, compared with the average of 6.1 billion over the past 20 days. The S&P 500 (.SPX) was up 13.43 points, or 0.62 percent, at 2,182.47. USA gold futures for December delivery settled up 0.09 percent at $1,327.10.
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Iran also said late last week that it would only cooperate in upcoming producer talks in September if other exporters recognised Tehran’s right to regain market share lost during global sanctions that were only lifted in January. USA crude (CLc1) was last down 69 cents, or 1.45 percent, at $46.95 per barrel.
