US shares up as economy slows
Thursday 16 February 1995
Industrial output rose 0.4 per cent in January, less than half the previous month's rise and in line with expectations. Separate figures for consumer prices showed some evidence of higher inflation, but not significantly more than had been expected.
The figures persuaded analysts that no further increase in US interest rates is likely before the Federal Reserve Board's policy committee meets in May.
The rise in output last month took it to a level 6.2 per cent higher than a year earlier. The strongest sector was business equipment, whose output was up 10.1 per cent in 12 months. Output of consumer goods grew only 3.6 per cent over the same period. Utitlities' output rebounded by 1.3 per cent in January after declining in the last quarter of 1994, although it remained 2.2 per cent down on a year ago.
The Federal Reserve said there had been a widespread slowdown in manufacturing industry. Its comments offset slight disappointment that consumer prices increased by 0.3 per cent in January, up from 0.2 per cent in December. It took the annual rate of inflation to 2.8 per cent.
The rise in "core" consumer prices, excluding food and energy, was 0.4 per cent - a sharp rise from 0.1 per cent the previous month, and taken as the first sign of rising inflation. David Bloom, US economist at James Capel, said that an increase of 0.5 per cent in services prices was particularly worrying.
Financial markets had expected higher inflation and took cheer from the Fed's comments. The Dow Jones Industrial Average was up 36.34 points at 3,994.59 at 2pm New York time, while the dollar had bounded above DM1.51.
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 3 How the language you speak changes your view of the world
- 4 The top 50 cities for young people to live in
General Election 2015: Fishing is on Nigel Farage's mind as he casts a line to the disaffected of Grimsby
Oxygen-starved 'dead zones' with no marine life up to 100-miles long discovered in the Atlantic Ocean
The man who filmed the Freddie Gray video has been arrested at gunpoint
Indonesia executions: Death row British grandmother Lindsay Sandiford will refuse to wear a blindfold when she faces firing squad
Russian warships accused of 'chasing away' Swedish vessel to prevent Baltic States from achieving energy independence
Over 50,000 families shipped out of London boroughs in the past three years due to welfare cuts and soaring rents
EU asylum policy is 'a direct threat to our civilisation', says Nigel Farage
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: SNP and its activists 'openly racist' towards the English, Farage says
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
iJobs Money & Business
£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...
£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...
£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...
£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...