All eyes on OPEC+
Oil prices are continuing to creep higher ahead of the OPEC+ meeting on Wednesday. Markets now expect a large output cut of over one million barrels per day, for which there is seemingly plenty of support.
But with the economic outlook becoming gloomier by the day, will the alliance go far enough to achieve the $90-100 oil they so clearly desire? I suspect any cut will accompany strong language over the prospect of further action, which may make up for any shortfall, should they take a more conservative approach.
A hot jobs report may spoil the party
All this talk of peak rates has excited the gold bulls, with gold leaping above $1,700 and gaining momentum. The sustainability of any rebound will ultimately depend on how long traders can convince themselves peak rates are priced in.
Looking back at past periods of optimism, we may be on borrowed time. Of course, rates can only go so far, and the RBA has already taken the decision to take its foot off the brake. But I’m not convinced the Fed is there yet, and a hot jobs report may spoil the party once more.