US Stocks Decline as Oil Prices Rise Amid Inflation Concerns
US stocks declined on Tuesday as they resumed trading after a three-day weekend. The decline was partly due to rising oil prices, which reached $99.46 per barrel briefly before settling at $97.92, up 0.9% from its July price of around $72.
The increased fighting in the Middle East has led to higher oil prices and is affecting global oil supplies. This has exacerbated concerns about inflation, which is still above the Federal Reserve's target of 2%.
On Thursday, the US government will release its August report on wholesale inflation, with economists expecting a rise to 5.4% from 4.7% in July. The more closely watched consumer price index (CPI) will be released on Friday and is expected to show eased inflation of 3.3%, down from 3.4% in July.
The Federal Reserve's decision on interest rates next week will be influenced by these inflation reports. With a nearly 60% probability that the Fed will raise its federal funds rate at the conclusion of its meeting on September 16, traders are anticipating higher borrowing costs and slower economic growth.