INFLATION

Federal Reserve Chairman Ben Bernanke will deploy his most reassuring bedside manner in congressional testimony on Wednesday and Thursday to explain how the U.S. central bank, which has already cut interest rates 2-1/4 percentage points since mid-September, can trim them further to prevent recession without letting inflation get out of hand.

U.S. stocks will face a heavy lineup of economic indicators next week

Gold futures edged lower in New York on Friday, consolidating below the$ 950 mark after hitting a fresh record-high yesterday on increased inflation risks which boosted the precious metal's appeal as an inflation hedge.

Copper prices rose on Thursday as investors' demand for commodities increased to protect investments against inflation.

The dollar slipped on Thursday, still weighed down by minutes from the Federal Reserve's January policy meeting, which affirmed expectations of further U.S. interest rate cuts.

Gold and platinum set historic highs in choppy trade on Thursday, with strong oil prices, a struggling dollar and supply worries boosting investor interest.

The greenback edged higher against the majors, climbing to 108.36 versus the yen and pushing the euro to 1.4615. A barrage of US economic data was released earlier in the session, with key indicators on inflation and housing

Gold futures closed higher on Wednesday, reversing early losses, as the precious metal's appeal as an inflation hedge and a safe haven continued to attract investors.

Inflation accelerated in January in a worrying sign for the Federal Reserve's campaign to bolster the flagging economy, while a separate report on Wednesday showed more troubling signs for beleaguered housing market.

Inflation fears and delays in debt payments by an affiliate of private equity giant KKR spooked financial markets on Wednesday, battering stocks and driving the cost of corporate debt insurance to all-time peaks.

Investors who have written off 2008 as a year of an economic slowdown and depressing stock market returns, are already gearing up to face a cocktail of new problems next year.

The dollar fell on Tuesday amid continuing speculation that the Federal Reserve will lower interest rates, and minutes from the Reserve Bank of Australia indicating that it had wanted to raise its interest higher than it did earlier this month.

India's Prime Minister Dr. Manmohan Singh said India is in a position to sustain economic growth of 9 percent despite a possible global slowdown and promised to keep inflation under control

Could a series of bleak economic reports signal recession?

The dollar fell against the euro on Friday after a gauge of consumer sentiment plunged to its lowest level since 1992, adding to fears that the U.S. economy may be slouching toward recession.

Consumer sentiment fell sharply in early February to levels associated with previous recessions, dragged down by concerns a bleak economic outlook would raise the unemployment rate, a survey showed on Friday. The Reuters/University of Michigan Surveys of Consumers index of consumer sentiment dropped to 69.6, the lowest reading since February 1992, and below analysts' median forecast for a preliminary reading of 76.3.

Federal Reserve Chairman Ben Bernanke on Thursday held the door open to more interest rate cuts to help the struggling economy, but told Congress the central bank expects growth to pick up later in the year. The Fed will act in a timely manner as needed to support growth and to provide adequate insurance against downside risks, Bernanke told the Senate Banking Committee.

Emboldened by public sector banks, State Bank of India (SBI) and Canara Bank's move of slashing prime lending rate (PLR) by 0.25 percent, India's Finance Minister P. Chidambaram has urged other state-run banks to follow suit to ensure that productive sectors of the economy are not starved of credit.

The Office for National Statistics (ONS) today released figures showing an increase in consumer prices index (CPI) annual inflation in January, largely a result of higher petrol prices.

The yen rose against the dollar and euro on Monday as stocks fell amid inflation concerns and continuing problems in financial markets.

In December house prices rose by 0.4 per cent on the previous month, according to the latest figures from the Department for Communities and Local Government (DCLG).Despite this the figures still point towards a slow down in house price growth. The latest statistics said that the annual rate of house price inflation was 9.1 per cent – down from 9.7 per cent in November.The latest figures add to evidence which suggests that the housing market boom may be coming to an end. Last year top mo...