By Dhirendra Tripathi
Investing.com -- Stocks fell after data that showed inflation in August ran cooler than expected, setting off a new wave of worries about how the Federal Reserve will respond.
Officials from the central bank meet next week and are expected to discuss the timing of the taper -- when the bank will start to pare back its massive monthly bond purchases that helped blunt the economic hit from the pandemic last year.
The timing of that decision has made for a choppy month in the markets, with investors going back and forth from euphoria over the progress of the recovery to fear that the good times are about over.
The Labor Department said consumer prices rose at their slowest pace in six months in August. July's reading was also a slight slowdown from the prior month. All along, Fed officials have said they believed any inflation from the reopening would be transitory.
Consumer prices for everyday goods are still high, however. And last week we had even stronger readings on producer price inflation.
Next up come retail sales figures, but not until Thursday.
Earnings season is largely behind us, but there is a smattering of other data of note this week. Here are three things that could affect markets tomorrow:
1. Industrial output
Growth in industrial output is likely to have cooled down to 0.4% in August from 0.9% in July, according to analysts tracked by Investing.com. The data are released at 9:15 AM ET (1315 GMT).
2. U.S. crude inventories
With yet another storm slamming the Gulf coast region this week, oil has been in the spotlight. Crude oil inventories in the U.S. for last week are seen eroding by more than double the prior week’s level. Analysts expect a draw of 3.903 million barrels after falling by 1.529 million barrels in the earlier week. The Energy Information Administration releases the data at 10:30 AM ET.
3. Gasoline inventories
Gasoline inventories, too, are seen lower but the pace of the decline is likely to have slowed considerably. Analysts tracked by Investing.com expect a draw of 1.967 million barrels for the week compared to the bigger draw of 7.215 million barrels a week earlier.
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