AUD/USD: pair has approached the support zone of 0.6489–0.6447During the Asian trading session, the AUD/USD currency pair is approaching the important support zone of 0.6489–0.6447 against the background of American statistics.Last week was marked by the publication of inflation data in the United States, which contributed to the strengthening of the US dollar in the market. The US consumer price index in March showed a monthly increase of 0.4%, which exceeded analysts' expectations of 0.3%, and the annual index was 3.5%, also higher than the predicted 3.4%. The producer price index increased by 2.1% year-on-year, from the previous 1.6%, although analysts expected an increase to 2.2%, while the monthly index decreased from 0.6% to 0.2%, ahead of forecasts of 0.3%. The core inflation rate rose from 2.1% to 2.4%, while the forecast was 2.3%. These data have increased doubts about the Federal Reserve's willingness to cut the rate by 25 basis points in June.The Australian economy also showed weak results: the number of construction permits issued fell by 1.9% monthly, which is in line with forecasts, while the previous figure was revised from -1.0% to -2.5%.Resistance levels: 0.6629, 0.6657, 0.6859.Support levels: 0.6489, 0.6447, 0.6353, 0.6285.Gold market analysisThe price of gold has stabilized around the level of 2350.00. Last week, gold reached a historic high, rising to the level of 2430.00, however, the bulls failed to hold this position, and many traders decided to realize the accumulated profits.The rise in gold prices continues to be supported by geopolitical instability and forecasts for rate cuts by the world's largest central banks. The European Central Bank is expected to lower interest rates as early as June, while the US Federal Reserve is likely to ease monetary policy later, with the first rate cut of 25 basis points expected in September.The latest macroeconomic data from the United States, published on April 12, increased pressure on the US dollar. The University of Michigan consumer confidence index fell from 79.4 to 77.9 points in April, which was lower than analysts' expectations of 79.0 points. The March import price index increased by 0.4%, accelerating by 0.1% compared to February, and on an annual basis the indicator also increased by 0.4% after a noticeable decrease of 0.8% a month earlier. Today, traders will closely monitor the March retail sales statistics in the United States, growth is expected to slow to 0.3% from February figures. The April index of business activity in the manufacturing sector from the Federal Reserve Bank of New York will also be published, an improvement from -20.9 to -9.0 points is projected.Resistance levels: 2375.00, 2400.00, 2431.44, 2450.00.Support levels: 2353.79, 2336.50, 2320.00, 2300.00.Cryptocurrency market analysisThe price dynamics of bitcoin tried to rise, breaking the 72000.00 level, but by the end of the week it fell sharply, losing about 14.5% of its value due to increased geopolitical tensions in the Middle East.Over the weekend, Iran conducted missile strikes against Israel, which led to investor fears about the possible outbreak of a large-scale military conflict, which, in turn, contributed to the reorientation of investments in defensive assets such as gold and the US dollar. This downward trend affected not only Bitcoin, but also the wide cryptocurrency market, where in a few days there were liquidations of open positions totaling about $2.5 billion. In addition, the pressure on digital assets was influenced by monetary policy, as the chances of continued high interest rates by the US Federal Reserve increased amid renewed inflationary pressures.These events lowered the price of Bitcoin to a six-week low of 60400.00, after which its partial recovery began. Traders are returning to the market, hoping that there will be no further escalation of the Iranian-Israeli conflict, according to representatives of American diplomacy. In this context, a possible resumption of growth of the main cryptocurrency assets, supported by the expectation of an upcoming halving in the Bitcoin network, seems quite likely in the foreseeable future.Resistance levels: 68750.00, 71875.00, 75000.00.Support levels: 62500.00, 59375.00, 56250.00.Crude Oil market analysisAfter rising to 92.42 on Friday, Brent crude oil quotes are experiencing a correction to 89.85 amid reports that the Iranian attack on Sunday caused minimal damage to Israel's infrastructure.Last week, after aggressive statements by Iranian leaders, the price of oil exceeded 92.00, as market participants feared the expansion of the armed conflict beyond the region. On Sunday, more than 300 rockets and drones were fired at Israel, most of which were successfully shot down by the Iron Dome air defense system. Mohammad Bagheri, the head of the General Staff of the Iranian Armed Forces, said that the "True Promise" mission has been completed and no further attacks are planned. According to him, Iran adheres to the principles of the UN Charter and is not interested in escalating the conflict. Against this background, the quotes of Brent Crude Oil moved to a decrease.The geopolitical situation in the Middle East remains difficult, which may lead to high volatility in the oil market in the coming months. Given that Iran is a significant oil producer in OPEC with production of more than 3 million barrels per day, the risks of supply interruption associated with sanctions and potential retaliatory actions by Israel contribute to the fact that the current price decline is rather corrective.Resistance levels: 91.95, 93.79, 96.22.Support levels: 89.10, 87.60, ...
EUR/USD: eurozone reported an increase in GDP for Q1In early trading, the EUR/USD exchange rate is experiencing an adjustment, being at the level of 1.0655, although economic statistics from the European Union show positive trends.On the eve of the meeting, many EU states presented results on gross domestic product (GDP) for the first quarter. France showed an improvement of 0.2%, reaching 1.1% year-on-year, which is higher than the previous 0.8%. Spain recorded a 0.7% quarterly GDP growth and an increase from 2.1% to 2.4% per annum, while in Italy the quarterly growth was 0.3%, although the annual rate decreased from 0.7% to 0.6%. The German economy grew by 0.2% compared to the previous 0.5% decline, but the annual rate remained negative at -0.2%. As a result, eurozone GDP improved from -0.1% to 0.3% quarterly and from 0.1% to 0.4% per annum. These data may contribute to the decision of the European Central Bank to lower interest rates. In this context, the head of the Dutch Central Bank, Claes Noth, stressed the continuation of the disinflation process, making the upcoming rate cut in June likely, but called for caution in the further steps of the regulator.Resistance levels: 1.0710, 1.0810.Support levels: 1.0620, 1.0500.GBP/USD: UK Mortgage Loan record in 18 monthsThe GBP/USD exchange rate is at 1.2470 and continues to decline amid unfavorable economic data from the UK.April figures from Nationwide Building Society showed a decrease in the housing price index by 0.4% for the month, which is worse than the predicted 0.2% and the previous value of -0.2%. The annual index also fell to 0.6%, against the expected 1.2% and the previous 1.6%. This trend contributes to an overall slowdown in inflation, which now stands at 3.2% compared to the previous figure of 3.4%. This gives the Bank of England the opportunity to reduce interest rates more actively, ahead of market expectations. In addition, in March, the number of approved mortgage loans reached 61.33 thousand, updating an 18-month record. The growth in consumer lending amounted to 1.577 million pounds compared with 1.429 million pounds a month earlier, and net borrowing by individuals increased to 1,800 million pounds against the projected 1,700 million.Resistance levels: 1.2525, 1.2697, 1.2875.Support levels: 1.2322, 1.2058.USD/JPY: exchange rate forms a global wave of appreciationThe USD/JPY pair fluctuates horizontally near the 157.82 mark, while the yen continues its decline, reaching a new peak of 160.00 on Monday, followed by a sharp rise in the currency. A significant correction followed after Japanese Prime Minister Fumio Kishida avoided answering questions about potential currency interventions at a press conference. Despite this, taking into account trading volumes, it can be assumed that the Bank of Japan took measures to influence the market, which should be confirmed by the report on the current balance of operations of the regulator, which will be published next week.The yen has been under pressure for a long time, not finding support in macroeconomic data: retail sales growth slowed from 4.7% to 1.2% in March, falling short of the projected 2.5%, which was the result of the increasing impact of inflation on household finances. According to a report by the Bank of Japan, prices for services continue to rise, but a significant increase in wages offered by companies may increase citizens' incomes this year and help stabilize the consumer price index at the target 2.0%. It should be noted that April showed an improvement in the index of business activity in the manufacturing sector to 49.6 points from 48.2 points, but this did not bring significant support to the yen.Support levels: 157.00, 154.50.Resistance levels: 158.30, 160.20.Oil market analysisBrent crude oil prices have stabilized at $85 per barrel.Economic data from China are supporting oil prices: in the first quarter, the country increased oil imports by 0.7% compared to the same period last year, reaching 137.36 million tons. At the same time, oil production in China increased by 2.3% to 53.48 million tons, refuting assumptions about a significant reduction in energy demand from the Chinese economy at the beginning of the year, which had a positive impact on market prices.However, the current local trend is under pressure due to the growth of strategic hydrocarbon reserves in the United States. According to information from the American Petroleum Institute (API), oil reserves increased by 4,906 million barrels over the past week, which contradicts analysts' expectations of a reduction of 1,500 million barrels. A new report from the US Energy Information Administration (EIA) is expected, where analysts predict an adjustment of -2.300 million barrels after the previous drop of -6.368 million, raising questions against the background of API data.Resistance levels: 86.50, 89.50.Support levels: 84.70, ...
AUD/USD: US dollar is declining against the Australian dollarDuring the Asian trading session, the AUD/USD pair showed growth, reaching 0.6585, thanks to strong macroeconomic support from Australia.The Australian economy has shown significant changes in the structure of prices for exports and imports. In the first quarter of this year, export prices decreased by 2.1%, and on an annual basis - by 8.3%, largely due to a decrease in prices for crude fertilizers and minerals by 58.1%, as well as metals and natural gas by 1.6% and 1.0%, respectively. Import prices fell by 1.8% quarterly and by 0.7% over the year, with the largest drop in prices for oil and petroleum products (-6.4%), electrical equipment (-4.9%) and pharmaceutical products (-3.5%).On the other hand, the US dollar continues its downward trajectory, being at the level of 105.300 on the USDX index. The latest report on the basic index of personal consumption expenditures in the United States showed an increase of 0.3% on a monthly basis and 2.8% on an annual basis, in line with expectations. Incomes and expenditures of the population also increased by 0.5% and 0.8%, respectively. However, recent data from the University of Michigan indicate a decline in consumer optimism, with the expectations index falling to 76.0 and the consumer sentiment index to 77.2. These factors may put pressure on the US currency and support further AUD/USD growth ahead of new economic data and policy decisions.Support levels: 0.6550, 0.6450.Resistance levels: 0.6610, 0.6720.USD/CAD: pair is losing ground, leaving the top of the channel 1.3850–1.3600In the Asian session, the USD/CAD currency pair shows a correction, stabilizing near the level of 1.3641. The latest statistics of the country's labor market have a positive impact on the Canadian currency.According to the latest data, in February there was an increase in the number of salaries to 17.7 thousand, which, however, is less than the January increase of 35.7 thousand. Annual figures also show steady growth: the total number of employees hired increased by 154.7 thousand or 0.9%. In addition, the number of vacancies increased to 656.7 thousand, which is 21.8 thousand or 3.4% more than in the previous period. These data highlight the strengthening of the Canadian labor market, which can play a key role in the country's further monetary policy and have an impact on the Canadian dollar.Resistance levels: 1.3700, 1.3820.Support levels: 1.3600, 1.3470.USD/CHF: currency pair reaches the top of SeptemberDuring trading, the USD/CHF pair settled at 0.9109, experiencing difficulties with increasing dynamics due to the discrepancy between macroeconomic statistics and analysts' expectations.The latest wage data in Switzerland showed a moderate increase in nominal wages by 1.7% in 2023, reaching 102.4 points compared to the previous year. In the context of current inflation at 2.1%, real wages decreased by 0.4%, and the real wage index dropped to 96.9 points, not reaching the stability threshold of 100.0 points. These indicators highlight the difficulties faced by the Swiss economy in the face of rising prices and put pressure on the exchange rate of the national currency paired with the US dollar.Support levels: 0.9050, 0.8950.Resistance levels: 0.9150, 0.9240.Oil market analysisLast week, Brent Crude Oil prices showed an uptrend, trying to gain a foothold above the 87.50 price level, which corresponds to the fourth Murray mark [4/8]. Both positive economic data and ongoing tensions in the Middle East contributed to the price increase.According to the latest April figures, the composite index of business activity in the eurozone rose to 51.4 points, which, according to analysts, indicates the likelihood of continued economic growth and Germany's exit from recession. At the same time, U.S. GDP growth slowed to 1.6% in the first quarter, falling below expectations, while data from the American Petroleum Institute (API) showed a decrease in reserves by 6.368 million barrels. These factors indicate a possible increase in global oil demand and support price growth.However, a possible settlement of the conflict between Israel and Hamas during negotiations in Cairo, with the participation of the United States, may reduce geopolitical tensions and, consequently, pressure on oil prices. A successful agreement can reduce the risks of supply interruption by influencing price dynamics. An additional impact on the market may be caused by the Federal Reserve postponing the timing of monetary policy easing until the end of the year, which may become known at the upcoming meeting of the regulator.Resistance levels: 88.55, 90.62, 93.75.Support levels: 85.70, ...
EUR/USD: American business did not meet analysts' expectationsIn the current trading session, the EUR/USD pair is showing growth, moving to the level of 1.0700 and updating the highs since April 12 thanks to the released macroeconomic statistics.The values of the indices of business activity in the manufacturing sector in France and Germany for April showed 44.9 and 42.2 points, having stabilized relative to the previous month. In the service sector in France, the index increased from 47.7 to 50.5 points, and in Germany — from 50.1 to 53.3 points. The entire region showed a decrease in manufacturing activity from 46.1 to 45.6 points, while in the services sector the index rose from 51.5 to 52.9 points, which contributed to the growth of the composite index from 50.3 to 51.4 points. Today will bring a speech by the President of the German Federal Bank, Joachim Nagel, in which the forecasts of economic development and inflation are expected to be clarified.Resistance levels: 1.0730, 1.0800.Support levels: 1.0670, 1.0600.NZD/USD: currency pair shows a short-term uptrendThe NZD/USD pair is seeing a slight upward momentum, aiming to exceed the recent peaks of mid-April: the exchange rate is approaching 0.5950, reflecting an increase when traders analyze the latest New Zealand trade data. March reports showed an increase in exports from 5.79 billion to 6.5 billion dollars and a decrease in imports from 6.1 billion to 5.91 billion, reducing the trade deficit from 12.06 billion to 9.87 billion dollars, and allowing the trade balance to reach a surplus of 0.588 billion on a monthly basis.At the same time, the US currency came under pressure after the publication of business activity indices for April: the S&P Global manufacturing index fell from 51.9 to 49.9 points, which is worse than expectations for growth to 52.0, and the services index fell from 51.7 to 50.9 points, against the forecast of 52.0 points.Resistance levels: 0.5950, 0.5975, 0.6000, 0.6030.Support levels: 0.5920, 0.5885, 0.5858, 0.5830.Analysis for GoldThe price of gold showed an uptrend, reaching the level of 2325.0, but now it is experiencing a correction, indicating a decline in the activity of traders focusing on short-term operations.Recent statistics from the United States, presented this week, may delay the start of the interest rate cut cycle until the fall, given that the main indicators for the Federal Reserve remain the real estate and labor market sectors. The March report showed a decrease in the number of building permits to 1.467 million, which is the lowest level since last fall and indicates the untimely reduction of interest rates in the near future. According to the CME FedWatch Tool, the probability of monetary policy easing at the Fed meeting on May 1 is only 5.2%, and at the meetings on June 12 and July 31 — 14.8% and 37.9%, respectively. In this situation, investors who expected to profit from the strengthening of gold came to the conclusion that at the moment a correction is more likely than a further strengthening of prices.Resistance levels: 2350.0, 2410.0.Support levels: 2290.0, 2220.0.Oil market analysisIn the Asian trading session, the prices of WTI Crude Oil demonstrate stability, holding near the level of 83.30 dollars per barrel. This is happening against the background of the publication of April data on business activity in key sectors of the US economy, which turned out to be below analysts' expectations: the index in the manufacturing sector from S&P Global fell to 49.9 points, and in services fell to 50.9 points.It is expected that later today, at 14:30 GMT, new data on orders for durable goods in the United States for March will be announced, which may affect investment sentiment. It is predicted that the indicator for capital goods will decrease to 0.3%, while the total volume of orders excluding the defense sector, on the contrary, will increase to 2.5%. In addition, at 16:30, data from the US Energy Information Administration on oil reserves for the past week will be published, which are tentatively estimated to decrease by 1.7 million barrels.Attention should also be paid to the recent report of the US Commodity Futures Trading Commission, which showed a decrease in net speculative positions on WTI oil to 290.5 thousand. The reporting data indicate the restructuring of investors' portfolios, which may signal the anticipation of changes in the market. Thus, the balance of positions among producers and traders showed an active movement both to buy and to sell, which foreshadows possible fluctuations in oil prices in the near future.Resistance levels: 84.00, 84.75, 85.50, 86.00.Support levels: 83.00, 82.00, 81.00, ...
OPEC+ is markedly reducing oil production - in fact, the exporting countries will pump about 1 million barrels less per day. We have written earlier on why this is so.As a result, supply at the market has become lower, so prices have gone up and are approaching $100 per barrel again.What will the U.S. do after the OPEC+ statement?The coming energy crisis and the high inflation it causes are scaring the whole world, but it's the States that are worried the most right now:expensive oil means expensive fuel;it's causing prices of almost all commodities to rise;inflation is going up - the Fed keeps tightening policy;high key interest rates are pushing the U.S. closer to recession;in addition, high fuel prices can cause social discontent.To prevent this, the U.S. is trying to influence the largest oil producers and keep prices down. Otherwise, the Democrats will most likely not win the congressional elections. They are due in a month.The U.S. started to prepare in advance: President Biden flew to Saudi Arabia this summer and persuaded the U.S. to bring down oil prices. But it did not work out very well: OPEC acts in its own way and does not want to listen to Americans. As a result, the failed negotiations with the Saudis have further diminished the credibility of Biden and the Democrats' ability to influence oil, inflation and economic stability in the United States.However, the Biden administration is not giving up; they have a few more options - rather radical ones - on how to lower oil prices.Additional Oil ReleaseThe safest, though least effective, option is to further draw oil from strategic U.S. storage facilities. In response to OPEC+'s decision to cut production, Biden announced that the U.S. would release 10 million barrels of oil, even as storage reserves are depleted.That would be all well and good, but the announcement had little or no effect on oil prices, especially compared to the previous similar decision to release 180 million barrels to the market. No wonder: the volumes are not comparable.In addition, since U.S. storage reserves are running out, there is a risk that they will not be enough for a rainy day: in case of sharp reductions in domestic production (for example, during hurricanes in the Gulf of Mexico) or imports (if OPEC+ countries reduce exports).Reducing military aid to the ArabsDemocrats have drafted a "Tense Partnership" bill in response to OPEC+ and specifically the alliance's leaders, Saudi Arabia and the UAE. They are accused of "a hostile act against the United States" and "siding with Russia in the conflict with Ukraine."As revenge, the U.S. could withdraw its troops from these countries and stop supplying weapons and other military aid to fight neighboring states and terrorists. This includes protecting oil infrastructure from attack.This option also has disadvantages: without U.S. military support in these countries, there could be problems that would inevitably affect the global oil supply. After all, if military actions or terrorist attacks affect the oil fields or storage facilities of Saudi Aramco, oil will cost even more, and such attacks occur quite often.So even if the Saudis and the UAE will not reduce exports in response to the withdrawal of troops and reduction of arms supply, there is a good chance that sooner or later the fighting will make prices go up.In addition, Saudi Arabia has already planned to prepare for a possible conflict with the United States. For example, in the spring the Saudis said they were going to explore ways to move away from the petrodollar - that is, not to use bucks in the black gold trade. In this case, the demand for the dollar could fall dramatically, especially if other oil-exporting countries do the same.NOPEC: Conflict with OPEC+Amid disagreements with OPEC, the U.S. may return to the "oil production and export cartel law," NOPEC, to have more leverage on oil exporters.In this case, U.S. courts will be able to consider antitrust suits against OPEC+ and in general against countries involved in cartel collusion in the oil market. Under the decision of their own courts, the U.S. will be able to impose sanctions, confiscate property of these countries and put pressure on them in other ways. At the same time, the U.S. itself will indicate what is legal and what is not, thus assessing any actions of the countries that regulate oil production and prices.This option also has a disadvantage: sanctions on exporters would also hit the U.S. itself. If oil prices become lower, the U.S. oil industry will also be hard hit: domestic production will decrease and it will have to import more. And since the market is competitive, and the U.S. in this case will be "enemies of OPEC +", they will have to buy oil more expensive.So, even if the U.S. takes a drastic step - provoking a conflict with Saudi Arabia or the UAE, or starting a sanctions war with OPEC+ - all this will have a negative impact on themselves.Can't sanctions be lifted on Venezuela?As we can see, the U.S. has almost no normal options left to influence the oil market. Nevertheless, the U.S. says it is not going to remove sanctions from Venezuela yet, despite the fact that this would help get more oil on the market and lower oil prices. We may see some new rhetoric in this regard, but no change for now.The Iran deal has also been stalled so far: there is no news or movement on it. Although it is possible that disagreements with the Saudis may attract the U.S. to support Iran, because these are the two sides of the Arab conflict.On the one hand, Iranian oil would help to increase supply, but there is a nuance here as well: the reserves in this country are not grandiose, moreover, most of the oil is already exported in circumvention of sanctions.So what to do with Brent and WTI crude oil prices in 2022?If we discard all of the above options, then all we have to do is sit back and watch oil go up in price. The outlook is also bad: even if the world starts a recession and the demand for oil decreases, OPEC+ is already reducing production and adjusting to negative expectations, and also the supply from Russia may decrease if the embargo comes into force.And if that's the case, U.S. inflation will be high. And given the strong labor market, the Fed may raise the rate even more than 1.25% by the end of the year, and it is not certain that it will slow down next year as well. If rates remain high for a long time, the risk of recession in the U.S. is very high, and stocks and cryptocurrencies will have no fuel for growth. As a result, the economy will have a hard time: liquidity is scarce.If the U.S. starts to act sharply, the dollar is at risk: the "oil" countries can give it up to reduce dependence on the United States. But if the U.S. does nothing, tightening Fed policy will keep the dollar very strong - though at the cost of high inflation and recession. 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In 2019, the "sub-sanctioned" Iran began to increase oil supplies in circumvention of sanctions. Mostly tankers went to China and the Mediterranean: Syria and Turkey. And by the beginning of 2022, the fleet for transporting sanctioned Iranian and Venezuelan oil had tripled. It accounted for approximately 400 million barrels per year. And such a "ghost armada" successfully undermines the business of transport companies.Why did Iranian tankers get such a name?Last year, The Mail on Sunday reported: 123 Iranian vessels circumvent sanctions on oil trade. They change their location to GPS and create the appearance that they are anchored at sea, but at this time they are loading/unloading at the port. They also actively forge documents, use flags of different countries, disable identification systems and use front companies. Oil is often loaded onto several vessels and mixed before reaching its destination. This is also the case with "toxic" Russian oil.At the same time, Iran has a whole "underground" financial system for trade bypassing sanctions, writes the WSJ. It includes accounts in foreign banks, intermediary companies outside the country and firms that coordinate prohibited trade. The annual turnover is estimated at tens of billions of dollars.And Iranian banks attract affiliated firms to manage trade under sanctions. They register "daughters" outside the country, become trusted for Iranian traders, and then trade with foreign buyers of Iranian oil in foreign currency through accounts in foreign banks.Will the "Iranian Armada" help Russia?She is already helping her to circumvent sanctions, writes the Daily Mail. The international non-profit organization United Against Nuclear Iran (UANI) accuses the Iranian navy of cooperating with Russian oil companies. Allegedly, Russian oilmen are using "Tehran's black market vessels" to circumvent the export ban. And the US, the EU and the UK are even calling for the formation of a team of "ghostbusters".At least 5 Iranian "ghost armadas" are transporting oil from Russia to China and India, according to UANI. And recently, the WSJ reported that Zamanoil from the UAE was linking Iranian and Russian oil workers. The US Treasury accused her of working with the Russian government and Rosneft on the supply of Iranian oil to Europe.However, at the end of March, Iran denied a "secret offer from Russia" to help it circumvent sanctions in exchange for support in concluding a nuclear deal. And in May, he noted that he could not be a competitor of Russia in the global oil and gas market. The country has its own regular customers, and Iran sells the maximum amount of oil.So officially, Iran does not seem to be planning to use its "army of ghosts" to help for the benefit of Russia, despite the fact that these countries have "converged" before. But then there was no question of an embargo on Russian oil and there was no ban on ship insurance. In the new reality, the actions of the "ghost armada" are quite difficult to ...
The year 2022 on world markets will largely be determined by the tightening of monetary policy in the United States, and the first week of the new year confirmed this. The minutes of the Fed's December meeting published last week showed a significant tightening of the position of the regulator's representatives – Fed members believe that the rate can be raised as early as March, and also see a faster reduction in the balance sheet as appropriate. Representatives of the regulator believe that the current economic conditions are already in many ways conducive to tightening the labor market, some even noted the recovery of the labor market already sufficient for such actions, although the majority still expects further improvement in the labor situation. Against this background, it is worth noting the publication of December labor data in the United States, which came out ambiguous. On the one hand, employment in December increased by only 200 thousand. The Bloomberg consensus forecast assumed an employment growth of 450 thousand, and the actual growth rate of the indicator was the lowest since the beginning of 2021. Nevertheless, in many respects such weak employment growth is explained by seasonal adjustment, and the unemployment rate in December fell more than expected. Thus, the indicator has updated the next lows since the beginning of the pandemic, dropping to 3.90% against the expected 4.10%. The unemployment rate continues to approach a historic low of 3.40%, and labor statistics have further increased fears in the market of an imminent tightening of the PREP in the United States. As a result, on Friday, the yields of ten-year US treasuries at the moment exceeded 1.80% per annum - the maximum since the beginning of the pandemic. Today they have returned to these levels again.This week, the dynamics in the market will continue to be determined by expectations for the actions of regulators - investors will follow the statements of representatives of the Fed and the ECB, as well as the publication of price data in the United States for December. Statistics published last week showed an increase in inflation in the EU to 5.00% YoY. As a result, the topics of price growth in December updated the historical maximum, while analysts expected a slight slowdown in price growth. The situation on the supply side also has high inflation in the United States. The December business activity indices indicated a slight easing of logistical problems, however, the further deterioration of the epidemiological situation again intensified disruptions in logistics chains, which does not lead to a significant slowdown in price growth. The FAO World Food Price index fell in December for the first time since July, but food inflation remains at elevated levels. Against this background, US inflation data is likely to continue to bring the Fed rate hike closer, intensifying the negative in the markets.The main event for the oil market in early 2022 was the OPEC+ meeting. However, as expected, it was decided to stick to the current plan to increase production. Nevertheless, the cartel lowered its forecasts for a surplus in the oil market, which allowed Brent crude futures to exceed the level of $80/bbl. Moreover, against the background of interruptions in the supply of black gold from Kazakhstan and Libya, quotations were close to $83/bbl. However, at the end of the week they declined from these levels, today Brent futures are growing by 0.35% and are trading around $82.05/bbl. The main negative for oil this week may be related to the potential strengthening of the dollar amid expectations of a tightening of the PREP in the United States. However, in the absence of a significant strengthening of the dollar, Brent futures may still exceed the levels of $83/bbl– - the quotes may be supported by another weekly decline in oil ...
Oil is getting more expensive on Friday morning. By 8.25 GMT, the price of a barrel of Brent oil rose to 70 dollars 89 cents, or 1.75%. The price of a barrel of WTI oil rose to 67 dollars 71 cents or 1.22%. According to the results of trading on Thursday, these oil standards rose by 1.2% and 1.4%, respectively. Investors evaluate the results of the last meeting of the countries participating in the OPEC+ agreement. Some market participants expected that the alliance would decide to reduce the volume of oil production. However, OPEC+ retained the current parameters of the deal. This means that the alliance will continue to increase the volume of raw material production by 400,000 b/s every month. At the same time, the participants of the meeting stated that they could make a different decision on the volume of production at any time. Everything will depend on the situation on the oil market and in the global economy. They noted the persistence of uncertainty. It intensified after the appearance of the next coronavirus strain omicron. Investors liked the alliance's statement about the possible holding of an extraordinary meeting, if the situation requires ...