NEW YORK (AA) – Wall Street closed lower Tuesday with worries that the Federal Reserve would institute more than one rate hike this year.
The Dow Jones lost 180 points to end at 17,529 points. The S&P 500 fell 19 points to close at 2,047, while the Nasdaq was down 59 points to end the day at 4,715.
It was the biggest daily decline for the Dow in the last seven weeks. Consumer Price Index, which measures changes in inflation, rose by 0.4 percent in April -- the highest monthly jump since February 2013. The rise in the index could mean the economy could reach a 2 percent inflation -- a target set by the Fed before another interest rate hike.
The Fed’s San Francisco President John Williams said Tuesday that macroeconomic data supports making more than one rate hike this year, adding it would not be a surprise for the bank to increase rates two or even three times in the following months.
Meanwhile, oil prices continued their rise to reach new record highs for this year.
American benchmark West Texas Intermediate (WTI) was up by almost 2 percent to trade at $48.67 per barrel at the final bell.
International benchmark Brent crude increased 1.2 percent to $49.55. The markets will focus on U.S. weekly crude oil inventories Wednesday.
Last week, crude stocks fell by 3.4 million barrels. Analysts expect another decline of 2.8 million barrels.
Another fall in crude inventories could push oil prices above the $50 per barrel mark – levels not seen since late last year.