Dow plunges more than 100 points, breaks 35,000, fears Fed cuts QE

The Dow fell more than 100 points, falling off 35,000 today, down five straight days amid concerns that The US Federal Reserve (Fed) will cut funding on its quantitative easing (QE) bond-buying program and raise interest rates faster than expected. After the US revealed inflation numbers rose today.

At 9:53 p.m. Thai time, the Dow Jones Industrial Average stood at 34,767.67, minus 111.71, or 0.32%.

The Dow rallied more than 100 points at first, in response to a phone call between US President Joe Biden and Chinese President Xi Jinping that will help ease the conflict between the two countries.

However, Wall Street shares later declined. After the release of the Producer Price Index (PPI) rose in August. This indicates that the US economy is still facing inflation. And it could cause the Fed to cut its QE limit and raise interest rates faster than expected.

The Labor Department said the PPI, a measure of inflation on manufacturers’ spending, rose 0.7 percent in August from month to month. It was higher than the forecast of 0.6%.

Year-over-year, the PPI rose 8.3 percent in August, a record high. Since the beginning of such data collection in November 2010. After rebounding 7.8% in July

The core PPI, which excludes food and energy, rose 0.3 percent in August month-on-month and 6.3 percent year-on-year. which is an unprecedented increase Since the beginning of such data collection in August 2014.

Markets will keep an eye on the US Consumer Price Index (CPI) on Tuesday, Sept. 14, to confirm US inflation.

Cleveland Fed President Loretta Mester said inflation in the United States will remain high this year. but will adjust down next year While the trend is risky in an uptrend

Mester also urged the Fed to start cutting its QE limits this year, despite weak US jobs in August.

The US Department of Labor reported on Friday that Non-farm payrolls rose just 235,000 in August. That was lower than analysts’ estimates of 720,000 jobs after rising 1,053,000 in July.

“I don’t think the August jobs numbers will change my view that the Fed has made great progress in meeting its employment and inflation targets,” Mester said.

The Fed will hold a monetary policy meeting on September 21-22, where investors are eyeing whether the Fed will signal a QE cut at this meeting.


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