Treasury yields tumble after weaker-than-expected retail sales, inflation

An aging population and lagging population will make it hard for the US to hit Donald Trump's growth target according to Janet Yellen

An aging population and lagging population will make it hard for the US to hit Donald Trump's growth target according to Janet Yellen

Euro strengthened against the dollar on Friday as the greenback weakened after a benign reading of US inflation in June and soft retail demand raised doubts the Federal Reserve would increase interest rates later this year.

Data from the Labor Department showed that consumer price index was flat in June after edging down by 0.1% in May.

The report said consumer prices in June were up by 1.6% compared to the same month a year ago, a deceleration from the 1.9% year-over-year increase growth in May.

Despite two straight months of decreasing retail sales, consumer spending likely gained steam in the second quarter after a helping to restrict economic growth to a 1.4 per cent annualised rate in the first quarter.

In a separate report, the Commerce Department said retail sales fell 0.2 per cent last month, weighed down by declines in receipts at service stations, clothing stores and supermarkets. However, the 10-year Treasury yield and US dollar continued to head lower.

The benchmark 10-year US Treasury note rose 8/32 in price to yield 2.3212 per cent. Australia's S&P/ASX 200 rose 0.3 percent to 5,751.10.

Core prices are viewed by the Federal Reserve (Fed) as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories. The euro jumped by 0.42%, hitting $1.1449.

"Yellen has indicated after the June policy meeting, in the clearest way as possible by her standards, that she plans to start balance sheet reduction and there will be one more rate hike this year".

Janet Yellen's recent cautious commentary reflects the facts about inflation, which are that both headline and, especially core inflation, are slowing, and slowing in a sustained trend, at that.

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Vanity also shared a behind the scenes photograph from shoot where she was getting the final touch up. In the black and white picture, Deepika is seen posing in a slip dress with a diamond necklace.

The lower-than-expected figures were the latest sign of muted inflation, which is a main threat to government bonds because it erodes the purchasing power of their fixed returns and can lead to higher interest rates from the Fed.

The New Zealand dollar held onto its overnight gains but was headed for a 0.8 percent weekly decline as investors await several U.S. economic indicators, including inflation numbers. Electricity costs slid 0.6 percent.

European shares are expected to rise, with spread-betters looking to gains of 0.3 per cent in Germany's DAX and Britain's FTSE, and a 0.2 per cent rise in France's CAC at the opening.

US 10-year yield fell to 2.303 percent, from 2.348 percent late on Thursday.

The Fed boss also cited growing concerns about weak underlying inflation, something that may deter the central bank from raising interest rates too quickly. Retail sales rose 2.8 per cent year-on-year in June.

The greenback edged down 0.2 percent to 1134.30 against Korean won.

U.S. crude futures rose 1.8 per cent to $45.83 per barrel, extending their recovery from Monday's near two-week low of $43.65.

Oil prices extended gains from the previous day as the USA government cut its crude production outlook for next year and as fuel inventories plunged.

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