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Inflation March 2007 Hitting Dollar Hard
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With the recent announcement from the labour department in the US regarding a rise in inflation has raised concerns about interest rates and the US dollar. (Check out the post here)
The latest US inflation reading would likely cement a decision next week by the Fed to keep US interest rates on hold at 5.25 percent. The core inflation reading, which strips out volatile food and energy costs, rose 0.2 percent and was in line with forecasts. The rise in inflation comes amid a wider slowing of the world's largest economy, although a separate economic indicator Friday was more upbeat.
A Fed report showed US industrial production rebounded by a much bigger-than-anticipated 1.0 percent in February after falling in the prior month.
The jump in industrial output across the United States marked the strongest gain since November 2005, but was largely attributed to a ratcheting up of gas and electricity output from the nation's utilities amid cold winter temperatures.
Investors are worried about an overall US economic slowdown, concerns that have been driven by the difficulties facing sub-prime housing lenders, who lend money to borrowers with patchy credit histories.
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Mar 19, 2007, 9:50 PM
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