Currencies
EUR/USD – while the data out of the Eurozone was mostly as expected, the MoM inflation was a bit lower than expected, weakening the EUR a bit in the aftermath. However, the general weakness of the USD cause this to be only short-lived.
USD/JPY – is still trading around the 100 level, but is edging a bit up today as the USD is moving slightly up and correcting some of its latest losses. In a month from now we will have both the BOJ decision at which it is expected (once more) that the BOJ will take action, and also the FED decision on the interest rate.
GBP/USD – again there was strong data out of the UK, which has boosted the GBP even higher. As also the USD was weakening again we saw a nice move up. Looking ahead though, we must remember that we still expect that the BOE will take further measure, weakening the GBP, unless the data remains stronger than expected. In that case it could be that the BOE will adapt a wait and see approach.
Commodities
Gold – even though the USD has been weakening a lot in recent days, this has not been reflected that much in the price of gold. We see gold move down as the USD is correcting some of its losses, in part due to renewed comments by several FED officials that they could raise the interest rate in the near future.
Oil – looks unstoppable and is moving higher. Yesterday’s move came on the backdrop of increased tensions between Russia and the Ukraine, with rhetoric from Ukraine’s President who stated that the country is prepared for full scale war with Russia, amid a Russian troop build-up along its border. We are seeing an increase in US production and this could be due to the fact that more and more rigs are coming back online again. As such we will be looking if we see the number of active rigs increase again.