On a day when the Federal Reserve's policy decisions are traditionally in focus, it was an early morning inflation report that offered the greatest indicator of the US central bank's near-term economic outlook.
Hours before chairman Jerome Powell faced reporters at the Federal Reserve building in Washington, the Labour Department reported inflation had slowed for a second straight month.
The Consumer Price Index report showed core inflation had risen 0.2 per cent from April to May, its smallest gain since October.
On an annual basis, core inflation rose 3.4 per cent, down from 3.6 per cent in April and 3.8 per cent in March.
But for Mr Powell, the CPI report was a case of too little, too late – at least for now.
“We welcome today’s reading and hope for more like that,” he said.
The Fed chairman demurred on whether the report would have any significant effect on the Fed's so-called dot plot, which showed officials scaling back their rate-cut projections this year from three to one.
Still, it was close, with eight officials forecasting one rate cut this year compared with seven who predicted two. Four officials pencilled in no rate cuts.
Mr Powell did not say if Wednesday's reading would have a significant effect on the Fed's rate-cut projections.
“What we said is that we want to make sure that we're confident that inflation is actually moving back down to 2 per cent," he said. "And when we are, then we can look at loosening policies.
“We're looking for something that gives us confidence that inflation is moving sustainably down to 2 per cent, and readings like today's, you know, that's a step in the right direction.”
He did caution that Wednesday's inflation reading was only one report.
But Wednesday's inflation report was celebrated by Fed watchers who hoped it showed that a surge in US consumer prices from earlier this year has come and gone.
“I would say that the CPI was overshadowed [by] what we learnt from a Fed that didn't change policy and happened to change the dot plot matrix a bit that was outside of consensus,” said Art Hogan, chief market strategist at B Riley Wealth.
“The CPI was the most important thing we've learnt today.”
Mr Hogan, who expects two rate cuts this year, believes Wednesday's reading alongside incoming data in the summer will deliver enough confidence for the Fed to begin cutting rates towards the end of this quarter.
“I suspect that it will be a September and December rate cut and I think that will be driven by data,” he told The National.
“I think we'll have enough data by September meeting that the majority of the voting members of the FOMC [Federal Open Market Committee] will see that they've made significant progress towards their target."
Oxford Economics' lead US economist Nancy Vanden Houten also considers May's reading to be the first in a string of positive data for the Fed.
“We expect a string of more favourable inflation releases … will clear the way for the Fed to lower rates in September,” she wrote.
Wells Fargo economists also expect two rate cuts this year, suggesting Fed members need more evidence to be convinced that they are in a situation to cut US interest rates.
“It will be a close call between one or two 25 [quarter-point] rate cuts, and the committee seems evenly split between the two outcomes,” chief economists Sarah House and Michael Pugliese wrote to investors.
“While the May CPI report released earlier today was encouraging for the inflation outlook, the FOMC clearly needs to see more benign prints before a consensus emerges that a reduction in the fed funds rate is warranted.”
The British in India: Three Centuries of Ambition and Experience
by David Gilmour
Allen Lane
Paris Can Wait
Dir: Eleanor Coppola
Starring: Alec Baldwin, Diane Lane, Arnaud Viard
Two stars
Results
4pm: Al Bastakiya – Listed (TB) $150,000 (Dirt) 1,900m; Winner: Panadol, Mickael Barzalona (jockey), Salem bin Ghadayer (trainer)
4.35pm: Dubai City Of Gold – Group 2 (TB) $228,000 (Turf) 2,410m; Winner: Walton Street, William Buick, Charlie Appleby
5.10pm: Mahab Al Shimaal – Group 3 (TB) $228,000 (D) 1,200m; Winner: Canvassed, Pat Dobbs, Doug Watson
5.45pm: Burj Nahaar – Group 3 (TB) $228,000 (D) 1,600m; Winner: Midnight Sands, Pat Dobbs, Doug Watson
6.20pm: Jebel Hatta – Group 1 (TB) $260,000 (T) 1,800m; Winner: Lord Glitters, Daniel Tudhope, David O’Meara
6.55pm: Al Maktoum Challenge Round-1 – Group 1 (TB) $390,000 (D) 2,000m; Winner: Salute The Soldier, Adrie de Vries, Fawzi Nass
7.30pm: Nad Al Sheba – Group 3 (TB) $228,000 (T) 1,200m; Winner: Final Song, Frankie Dettori, Saeed bin Suroor
21 Lessons for the 21st Century
Yuval Noah Harari, Jonathan Cape
Founders: Ines Mena, Claudia Ribas, Simona Agolini, Nourhan Hassan and Therese Hundt
Date started: January 2017, app launched November 2017
Based: Dubai, UAE
Sector: Private/Retail/Leisure
Number of Employees: 18 employees, including full-time and flexible workers
Funding stage and size: Seed round completed Q4 2019 - $1m raised
Funders: Oman Technology Fund, 500 Startups, Vision Ventures, Seedstars, Mindshift Capital, Delta Partners Ventures, with support from the OQAL Angel Investor Network and UAE Business Angels
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Pieces of Her
Stars: Toni Collette, Bella Heathcote, David Wenham, Omari Hardwick
Director: Minkie Spiro
Rating:2/5
Abramovich London
A Kensington Palace Gardens house with 15 bedrooms is valued at more than £150 million.
A three-storey penthouse at Chelsea Waterfront bought for £22 million.
Steel company Evraz drops more than 10 per cent in trading after UK officials said it was potentially supplying the Russian military.
Sale of Chelsea Football Club is now impossible.
Killing of Qassem Suleimani
The%20trailblazers
%3Cp%3ESixteen%20boys%20and%2015%20girls%20have%20gone%20on%20from%20Go-Pro%20Academy%20in%20Dubai%20to%20either%20professional%20contracts%20abroad%20or%20scholarships%20in%20the%20United%20States.%20Here%20are%20two%20of%20the%20most%20prominent.%0D%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EGeorgia%20Gibson%20(Newcastle%20United)%3C%2Fstrong%3E%0D%3Cbr%3EThe%20reason%20the%20academy%20in%20Dubai%20first%20set%20up%20a%20girls%E2%80%99%20programme%20was%20to%20help%20Gibson%20reach%20her%20potential.%20Now%20she%20plays%20professionally%20for%20Newcastle%20United%20in%20the%20UK.%0D%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EMackenzie%20Hunt%20(Everton)%3C%2Fstrong%3E%0D%3Cbr%3EAttended%20DESS%20in%20Dubai%2C%20before%20heading%20to%20the%20UK%20to%20join%20Everton%20full%20time%20as%20a%20teenager.%20He%20was%20on%20the%20bench%20for%20the%20first%20team%20as%20recently%20as%20their%20fixture%20against%20Brighton%20on%20February%2024.%0D%3C%2Fp%3E%0A
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
UAE currency: the story behind the money in your pockets
JERSEY INFO
Red Jersey
General Classification: worn daily, starting from Stage 2, by the leader of the General Classification by time.
Green Jersey
Points Classification: worn daily, starting from Stage 2, by the fastest sprinter, who has obtained the best positions in each stage and intermediate sprints.
White Jersey
Young Rider Classification: worn daily, starting from Stage 2, by the best young rider born after January 1, 1995 in the overall classification by time (U25).
Black Jersey
Intermediate Sprint Classification: worn daily, starting from Stage 2, by the rider who has gained the most Intermediate Sprint Points.
RESULTS
West Asia Premiership
Thursday
Jebel Ali Dragons 13-34 Dubai Exiles
Friday
Dubai Knights Eagles 16-27 Dubai Tigers
