Europe Asia News

On Thursday, weekly jobless claims fell to their lowest level in five weeks, while the Philadelphia Fed business outlook survey unexpectedly jumped to a five-month high. However, the US trade deficit widened in December and pending home sales declined in January.

Investors are now focused on fourth-quarter GDP figures and consumer price index data, the Fed’s preferred inflation gauge. Minutes from the latest Federal Open Market Committee (FOMC) meeting showed that policymakers were divided over the interest rate outlook; some indicated that additional hikes may be needed if inflation remains elevated.

Fed Board member Stephen Miran said he now expects a “less accommodative” rate path, citing resilience in employment and persistent goods inflation. Investors have scaled back expectations of aggressive easing but continue to price in two 25-basis-point rate cuts by year-end.