Daily Market Update 2/8/11

Upward pressure on rates continued Tuesday. Overnight, China raised interest rates for the third time since October to fight inflation. This morning, Federal Reserve Bank of Richmond President Jeffrey Lacker called for the Fed to “quite seriously” re-evaluate its plan to purchase $600 billion of US Treasuries to stimulate the economy. He expressed concern that “inflation is capable of accelerating”. Representative Paul Ryan, head of the House Budget Committee, called on the Fed to begin raising interest rates now. Tomorrow, Fed Chairman Ben Bernanke will testify before Congress on the central bank’s monetary policy. Investors will be watching closely. No economic data will be released today.

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