BREAKING NEWS – All eyes on EURUSD
ECB’s President Mario Draghi comes forward today at 14:30 GMT. His speech will revolve around the thorny topic of monetary policy, putting pressure on the EURUSD. Today is also the first day of a two-day ECB meeting on monetary policy.
In the US, a few of the main market drivers are the rumours revolving around President Donald Trump’s decision to replace the Federal Reserve’s chairperson Janet Yellen. Discussions with the former Federal Reserve head Kevin Warsh and Fed governor Jerome Powell have already been conducted by the Trump administration. There’s a high chance that the winner of this rally will be Kevin Warsh, who was part of the Board of Governors of the Federal Reserve. The very likely new Fed chairman appointment comes in a package with the dollar’s strengthening last week.
What’s in it for EURUSD? Despite yesterday’s growth, the pair remains under pressure amid the rising political tension in Spain due to the referendum in Catalonia and following the German elections, with Angela Merkel winning the majority in the Bundestag, which secures her the Chancellor’s chair for another four years.
Crude Oil Inventories
Moving forward, on the other side of the pond, crude oil inventories are the next market mover today.
Oil prices slipped on Thursday as the US fuel inventories went higher despite OPEC’s endeavour to cut output and tighten the market, Reuters reports.
US West Texas Intermediate (WTI) crude futures CLc1 were trading at $51.05 a barrel at 01:12 GMT, lower by 22 cents or 0.4% as against their last settlement.
Brent crude futures LCOc1, which are also the international benchmark for oil prices, traded at $56.62, 32 cents lower or 0.6% compared with their previous close.
As of this year, OPEC (Organization of the Petroleum Exporting Countries) along with other oil producing countries, including Russia agreed to cut production by 1.8 million barrels a day (bpd) to support prices.
This OPEC-mastered deal helped rise oil prices from $30-$40 per barrel range towards the end of 2016, beginning of 2017. However, traders suggest that the general supply stays ample despite these cuts, owing a lot to the US production leaps – C-OUT-T-EIA.
Consequently, the general sentiment across the oil industry is that OPEC will extend the yield cuts beyond March 2018, the initially set date.