A raft of global risks that could adversely affect the United States remains on the horizon and requires close monitoring, Dallas Federal Reserve Bank President Robert Kaplan said on Tuesday.
Kaplan, along with several other Fed policymakers, has urged renewed caution in trying to lift rates again since the U.S. central bank raised its benchmark interest rate for the first time in almost a decade last December.
The U.S. Fed is looking for a "healthy margin above" 80,000 to 125,000 new jobs each month to give confidence of removing slack in the U.S. economy, Dallas Federal Reserve Bank President Robert Kaplan said on Tuesday.
Atlanta Federal Reserve Bank President Dennis Lockhart said on Tuesday it was too soon to rule out an interest rate increase at the U.S. central bank's next meeting in September, with a lot of data set to come in on the health of the economy.
"At this point, I don't rule out a rate increase at the next meeting or later in the year," Lockhart said on CNBC. "We just have to wait and see how the data come in."
U.S. crude oil fell on Tuesday to end below $40 a barrel for the first time since April as persistent worries of both a crude and refined fuel glut and a slide in U.S. equities offset an early boost from a weak dollar.
U.S. West Texas Intermediate (WTI) crude settled down 55 cents, or 1.4 percent, at $39.51 a barrel, after earlier rallying to $40.91. On Monday, it slid to an intraday session low below $40 for the first time since April.
U.S. consumer spending rose more than expected in June as households bought goods and services, suggesting strength that appeared to be sustained early in the third quarter with auto sales surging to an eight-month high in July.
Despite healthy consumer spending, Tuesday's report from the Commerce Department showed inflation still muted. Economists say this, together with weak business investment and the second quarter's anemic economic growth pace, could encourage a cautious Federal Reserve to keep interest rates at current low levels for a while.
The dollar dropped to a six-week low against a basket of currencies on Tuesday, pressured by expectations the Federal Reserve would delay raising interest rates after recent soft U.S. economic data.
The U.S. currency also slid to a three-week trough against the yen, as the Japanese government approved a largely expected set of stimulus measures. The dollar also fell to its lowest in six weeks against the euro.
The greenback extended losses after U.S. data showed little inflation. A key inflation measure - the core personal consumption expenditure index - grew by a modest 0.1 percent in June, which kept the annual inflation rate unchanged at 0.9 percent.
On Friday, the U.S. government reported tepid gross domestic product growth for the second quarter.
In late trading, the dollar index .DXY fell 0.7 percent to 95.048, after earlier sliding to 95.0031, the lowest level since June 24.
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