US stocks declined for the week as recession fears continue to push the market lower. The S&P 500 dropped 2.2% for the week and the Dow fell 1.3% for the week. Foreign markets also declined with the FTSE All World Ex US losing 1.8% for the week. US crude increased to $108.43 per barrel up from $107.62 the week prior. The yield on the 10-year Treasury fell to 2.90% down from 3.13% the week prior.
The PCE index, the Feds preferred inflation gauge, increased by 6.3% in May. The increase was the same as in April and lower than the record high rate of 6.6% in March.
US manufacturing activity slowed more than expected in June, with manufacturing PMI dropping to 53.0, down from 56.1 in May. June’s reading was the lowest since June 2020.
The Fed said it was more concerned about failing to get high inflation under control than about the possibility of raising rates too high and pushing the economy into a recession.
US consumer spending increased by 0.2% in May, the smallest increase of the year, as high inflation and elevated interest rates reduced spending.
The ECB said it would increase its key rate by 0.25% in July, to negative 0.25%, indicating it would gradually raise rates over the coming months, deviating from the global push towards faster increases.