A soft landing is the ideal Fed policy goal after raising interest rates, a situation in which inflation slows but there are not enough job losses to trigger a recession.
On Wall Street, the Dow Jones Industrial Average fell 112.96 points, or 0.34 percent , to 33,517.65, the S&P 500 lost 2.99 points, or 0.08 percent , to 3,892.09 and the Nasdaq Composite added 66.36 points, or 0.63 percent , to 10,635.65. Money markets were pricing in a 25 percent chance of a half-point U.S. rate hike in February, down from around 50 percent a month ago. Investors will look to Thursday’s CPI data for further clues as to the Fed’s next move.
In bond markets, European government bond yields rose in a reversal after the previous weeks’ sharp falls. Germany’s benchmark 10-year government bond yield was up 4 basis points at 2.252 percent .The yield on 10-year Treasury notes was down 4.1 basis points to 3.530 percent . Bond yields move in the opposite direction of prices.