Will lingering unemployment spur monetary stimulus and dollar devaluation?
*Reuters, by Lucia Mutikani, August 15, 2012
”Consumer prices were flat in July for a second straight month and the year-over-year increase was the smallest in more than 1-1/2 years, giving the Federal Reserve room for further monetary easing to tackle stubbornly high unemployment.
Other reports on Wednesday showed home-builder sentiment in August hit its highest level in more than five years, while industrial production rose in July. However, a gauge of manufacturing in New York state contracted this month.
The tame inflation reading leaves more stimulus from the U.S. central bank on the table, even though data on job growth and retail sales have hinted at a pick-up in economic activity early in the third quarter. The unemployment rate is at an uncomfortably high 8.3 percent.”
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