Oil slides amid Chinese Covid restrictions
Oil prices fell again on Wednesday, taking losses over the last couple of days to more than 5%. Brent and WTI are flat on the day at the time of writing, settling towards the lower end of their recent trading ranges.
While the narrative in recent weeks has focused on the potential for Chinese COVID restrictions to be relaxed, which has driven Chinese equities higher and lifted oil prices, the reality has seen case numbers soaring, restrictions reimposed, and mass testing is undertaken.
This doesn’t add substance to the rumors, and we may be seeing some unwinding of those positions.
Gold steadies ahead of CPI data
Gold has steadied over the last 24 hours or so after surging late last week and early this in the hope that inflation data delivers what the Fed, and investors, crave so much. It’s a very hopeful-looking move and one that could end badly if the CPI data continues this year’s trend of disappointing to the upside.
At this point, I wonder what investors need to see because the last week's recovery has been strong – more than 5% – which suggests expectations are pretty high. Time will tell if hopeful traders will be burned once more.