World stocks eye 1% weekly loss, U.S. yield curve indicates recession

LONDON/SYDNEY – World stocks were heading on Friday for a 1-percent loss on the week, drifting from recent two-month highs after U.S. Federal Reserve officials fired more warning shots on interest rates, while the U.S. bond yield curve priced for a recession.

The dollar and bond yields rose after St. Louis Fed President James Bullard said interest rates might need to hit a range from 5-5.25 percent from the current level of just below 4 percent to be “sufficiently restrictive” to curb inflation.

That was a blow to investors who had been wagering rates would peak at 5 percent and saw Fed fund futures sell off as markets priced in more chance that rates would now top out at 5-5.25 pe…

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