Not so sure about QE3, the Fed is essentially trapped.
If they follow BOE, printing will stop and austerity will
set in. Then they may have to raise. Stagflation is officially
here.
True, the Fed, unlike other CBs abroad, does not seem to care
and could print, damn the torpedos full speed ahead.
We just have to wait and see.
finance.yahoo.com
FED WORRIES ABOUT COMMODITY PRICES
The central bank said in its Beige Book summary of economic conditions on Wednesday that businesses were reporting that higher commodity costs were putting upward pressure on prices.
But with the labor market still weak and wage growth subdued, producers have limited capacity to pass on the higher costs to consumers.
A second report from the Labor Department showed initial claims for state unemployment benefits rose 27,000 to a seasonally adjusted 412,000, well above economists' expectations for a fall to 380,000.
The four-week moving average of unemployment claims -- a better measure of underlying trends - climbed 5,500 to 395,750.
The rise in claims interrupted a downward trend that had kept them below the 400,000 threshold for four weeks. That level is normally associated with steady job growth. Despite last week's rise, the four-week average held below the 400,000 mark for a seventh straight week.
S&P index futures extended losses on the claims data, while U.S. government debt prices extended gains.
Energy prices, which rose 2.6 percent, accounted for nearly 90 percent of the increase in wholesale prices last month. Energy prices rose 3.3 percent in February.
Gasoline prices rose 5.7 percent after increasing 3.7 percent in February. Food prices fell 0.2 percent, the first decline since August. |
