Major indices in the US stock market opened mixed on Friday after a Federal Reserve official said inflation could get out of the central bank’s control.
“We’re at more risk now than we’ve been in a generation that this could get out of control,” St. Louis Fed President James Bullard said Thursday during a panel talk at Columbia University.
He said a worse scenario would be inflation climbing further, and the Fed does not want this to happen.
Bullard said the Fed is more than 300 basis points behind its inflation target and added that the central bank needs to “pivot to less accommodation.”
He also argued that raising interest rates would not pose a recession risk for the American economy.
Bullard, who is a voting member of the Federal Open Market Committee this year, said Monday the Fed’s credibility is “on the line” amid record-high inflation.
On Feb. 10, he said he expected that the Fed would make a total of 100 basis points of an interest rate increase before July in order to tame record-high inflation.
US consumer prices in January soared to 7.5% year-on-year, marking the largest 12-month increase since February 1982, according to the Labor Department.
At Friday’s opening, the Dow Jones fell 110 points, or 0.32%, to 34,203 at 9.36 a.m. EDT. The S&P 500 lost 7 points, or 0.16%, to 4,373.
The Nasdaq decreased 41 points, or 0.3%, to 13,675 points.
Despite the ongoing tension between Russia and Ukraine, the VIX volatility index was down 0.04% to 28.10, while the yield on 10-year US Treasury notes fell 1.8% to 1.939%. The dollar index was up 0.14% to 95.94.
Precious metals were mixed with gold losing 0.06% to $1,897 per ounce, but silver gaining 0.7% to $24 an ounce.
Oil prices were down around 2% with Brent crude trading at $91.22 per barrel and US benchmark West Texas Intermediate at $89.78.
Source: Anadolu Agency