Low-Inflation Inertia Adds Risk of Misfire in Fed Rate-Rise Plan
(Bloomberg) -- Prices go up and prices go down. At the Federal Reserve, a bigger worry now is that they stay the same.
U.S. central bankers are betting the economy is near an inflection point where demand is strong enough to create more jobs, eventually nudging both wages and prices higher. A report Friday showed payrolls in the past three months rose the most in 17 years while wages showed the biggest gains since 2008, reinforcing views the threshold is close.
That should help meet Fed Chair Janet Yellen's requirement for officials to be "reasonably confident" inflation is heading higher before raising interest rates this year.
The nagging problem that's making them "nervous," says St. Louis Fed President James Bullard: the longer inflation stays below the Fed's 2 percent target -- as it has for 32 months -- the higher the risk that it remains stuck in a low range.
Brent crude rally ends as China inflation hits five-year low
(Reuters) - Brent fell below $58 a barrel on Tuesday after China's consumer inflation came in at a five-year low for January, raising worries about oil demand in the world's second-largest economy.
The International Energy Agency (IEA) also said the United States will remain the world's top source of oil supply growth up to 2020, defying expectations of a dramatic slowdown in shale output and keeping fears of a continuing glut at the forefront.
Brent crude slipped 64 cents to $57.70 by 0730 GMT (2:30 a.m. EST), ending a three-day rally. The benchmark gained more than 9 percent last week, its biggest weekly rise since February 2011.
UK's Osborne says danger of 'very bad outcome' on Greece increasing: Bloomberg
(Reuters) - British finance minister George Osborne said the danger of a miscalculation leading to a "very bad outcome" between Greece and the euro area is increasing, Bloomberg reported.
"It's clear that the risks to the world economy, the risk to the British economy of this standoff between the euro zone and Greece, is growing each day," Osborne said in an interview with Bloomberg Television in Istanbul late on Monday.
"The risks of a miscalculation or a misstep leading to a very bad outcome are growing as well," Osborne said.