Forex News USD lifted on falling oil prices, more talk of need for U.S. rate hikes to curtail inflation, despite brief weakness on Fed's Beige Book, which showed slowing economy, elevated price pressure in June, early July. EUR/USD at 1.5690 in late NY, vs 1.5778 late Tuesday; USD/JPY at 107.85 late vs 107.33, EUR/JPY at 169.25 vs 169.32. Crude futures dropped to under $125 after U.S. weekly gasoline inventories show surprisingly strong pickup; September crude settled $3.98 lower at $124.44/bbl on Nymex, lowest since June 4. Philadelphia Fed's Plosser following Tuesday's speech which highlighting worries over inflation, reiterated those concerns Wednesday; suggested in Bloomberg television interview that rates need to be raised sooner rather later.
Treasurys down again, pressured by massive supply of government debt, recovering risk appetite; in late trading, 2-year note down 2/32 at 100 8/32 to yield 2.74%, 5-year down 6/32 to 99 14/32 to yield 3.50%, 10-year down 4/32 to 98 1/32 to yield 4.12%. House of Representatives pass broad package of housing-related items; legislation includes $300 billion program to refinance troubled mortgages with federal insurance, new regulator for Fannie, Freddie, overhaul of Federal Housing Administration. Stocks modestly higher; investors continue rotating out of oil, commodity stocks into financials, consumer stocks; DJIA +0.3%, Nasdaq +1.0%. Strength in financial equities took some of flight-to-quality momentum out of gold; Comex August gold down $25.70, settling at $922.80/oz on Nymex. LME copper futures finished lower on falling crude, recent USD gains; 3-month copper down $50 at $8080/ton bid.
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