Dow Jones posts its fifth consecutive weekly gain

NEW YORK (AP) ? Wall Street resumed its advance Friday as investors interpreted a government report of milder inflation as a signal that the Federal Reserve might consider cutting interest rates later this year. The Dow Jones industrial average soared more than 100 points, and posted its fifth straight weekly gain.

Investors were encouraged after the Labor Department’s producer price index ? which measures the rate of inflation experienced by manufacturers when they purchase goods ? suggested inflation is moderating. This raised hopes on Wall Street that central bankers won’t need to hike interest rates to keep the economy in check, and might even lean toward lowering them.

With corporate earnings reports slowing, the market has put more weight on economic data to help find a direction. The fresh batch of economic reports could help assure central bankers that they have navigated the economy toward a soft landing in which growth slows enough to restrain inflation.

The stronger economic news, especially about inflation, injected a new dose of confidence that central bankers can now begin to mull a rate cut. It also helped reignite a rally stopped short Thursday after retail sales reports dimmed expectations about consumer confidence.

?To some degree, the advance is in reaction to the sharp selling on Thursday,? said Richard Cripps, chief market strategist for Stifel Nicolaus. ?The market was due for a blowoff, and I think the data you got this morning don’t get in the way of the positive trend under way. A fair amount of investors want to be in the market.?