Month: May 2023

Copper hits a seven-month low of $3.61/lb on deteriorating demand outlook

Posted on by Vrasidas Neofytou

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The price of red metal fell as low as $3,61/lb on Tuesday morning, or 1.5% down, its lowest since November 2022, following steep losses of nearly 15% since intraday highs of April, after a string of disappointing economic readings from China, the world’s largest copper consumer, pointing to a weak outlook for copper demand.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

The price of red metal fell as low as $3,61/lb on Tuesday morning, or 1.5% down, its lowest since November 2022, following steep losses of nearly 15% since intraday highs of April, after a string of disappointing economic readings from China, the world’s largest copper consumer, pointing to a weak outlook for copper demand.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Copper slumped the most in seven months as weaker-than-expected macroeconomic data in China, Europe, and the USA, fears of a global recession, U.S. default risk, and the rebounding dollar have temped the demand outlook for the metal used in manufacturing and construction.

The price of red metal fell as low as $3,61/lb on Tuesday morning, or 1.5% down, its lowest since November 2022, following steep losses of nearly 15% since intraday highs of April, after a string of disappointing economic readings from China, the world’s largest copper consumer, pointing to a weak outlook for copper demand.

Copper, Daily chart

Adding to China’s industrial weakness, commodities investors have been worrying about slowing economic growth in USA and Eurozone (mainly France & Germany), the world’s second and third economies, following the weak readings for flash manufacturing PMI, construction, and home sales.

The manufacturing conditions have been deteriorating around the world, hitting multi-month lows according to official data, dragged down by the slump in Chinese manufacturing that has begun in the second quarter of the year as China’s post-pandemic economic recovery eased, battering copper.

Overall, the copper demand outlook is deteriorating as global growth slows in the face of rising interest rates which boost borrowing costs, and resilient Core inflation, despite the recent weakness in crude oil and natural gas prices.

U.S. dollars strengthen in the last session after some hawkish comments from Fed officials have also weighed on the dollar-denominated copper prices, making it more expensive for buyers with foreign currency.

 

U.S. Debt default risk adds pressure on Copper:

The uncertainty surrounding U.S. debt ceiling negotiations also has been weighing on the growth-sensitive red metal. U.S. President Joe Biden and House officials have been discussing how to raise the U.S. government’s $31.4 trillion debt ceiling until the deadline of June 07.

In case of no agreement, we are going to have the first-ever U.S. government default that would roil the financial markets and likely lead to a global recession, which would be a negative catalyst for the demand for copper and other industrial metals.

Turkish Lira hits an all-time high of $20 a dollar on political uncertainty

Posted on by Vrasidas Neofytou

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Political and economic uncertainty due to the coming elections in Turkey has weighed on the Turkish Lira, which posted a new all-time low of $20 to the U.S. dollar this morning, while it also dropped to €21.50 to the euro, slightly below the record low of €21.66 hit last week.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Political and economic uncertainty due to the coming elections in Turkey has weighed on the Turkish Lira, which posted a new all-time low of $20 to the U.S. dollar this morning, while it also dropped to €21.50 to the euro, slightly below the record low of €21.66 hit last week.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Turkish Lira hit a fresh record low of $20 a dollar on Monday morning, extending monthly losses as investors are in a cautious mood ahead of the 2nd round of the presidential election on Sunday, May, 28.

Political and economic uncertainty due to the coming elections in Turkey has weighed on the Turkish Lira, which posted a new all-time low of $20 to the U.S. dollar this morning, while it also dropped to €21.50 to the euro, slightly below the record low of €21.66 hit last week.

USD/TRY pair, Weekly chart

Investors have become sellers of the Lira since the beginning of 2023, with USD/TRY pair losing nearly 5% so far, on worries that President Erdogan could win another mandate in Sunday’s elections.

President Erdogan had a stronger-than-expected voting victory of 49.44% in the Presidential election on the 1st round last Sunday against his major rival Kemal Kilicdaroglu, who also got 44.86% ballots, which weighed on Turkish assets.

Turkish central bankers backed by Erdogan’s will, have applied unusual monetary policies to curb inflation that toped nearly 85% last year, by cutting interest rates despite elevating inflation and resulting in an over 40% Lira depreciation in 2021, and 30% in 2022.

Turkey’s FX reserves have also depleted to record lows after many interventions by the authorities to stabilize the Lira’s depreciation against the dollar and euro in the previous currency turmoil, coupled with a status quo of the unorthodox monetary policy.

Some local economists believe that if Erdogan is defeated by Kilicdaroglu on Sunday, Lira assets should rally on the basis that policy orthodoxy will be restored, and political uncertainty will be eased.

Japanese stocks rally to their highest level since the 1990s “bubble era”

Posted on by Vrasidas Neofytou

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Adding to that, the other major index Nikkei 225 hit an intraday high of 30,924 points on Friday morning after a 1% gain, posting its highest since November 2021 led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Adding to that, the other major index Nikkei 225 hit an intraday high of 30,924 points on Friday morning after a 1% gain, posting its highest since November 2021 led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Topix has gained more than 6% in 2023 so far led by utilities, consumer cyclical, technology, and financials, while well-known tech giants companies such as Nintendo, Sony, Softbank Group, and Tokyo Electron were among the top gainers.

Adding to that, the other major index Nikkei 225 hit an intraday high of 30,924 points on Friday morning after a 1% gain, posting its highest since November 2021 led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Topix has gained more than 6% in 2023 so far led by utilities, consumer cyclical, technology, and financials, while well-known tech giants companies such as Nintendo, Sony, Softbank Group, and Tokyo Electron were among the top gainers.

Adding to that, the other major index Nikkei 225 hit an intraday high of 30,924 points on Friday morning after a 1% gain, posting its highest since November 2021 led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Japan’s broad-based index “Tokyo Price Index”, also known as “Topix” (made up of about 2,000 stocks) added 0.6% this morning, hitting its highest point since August 1990, the country’s so-called “bubble” era.

Topix has gained more than 6% in 2023 so far led by utilities, consumer cyclical, technology, and financials, while well-known tech giants companies such as Nintendo, Sony, Softbank Group, and Tokyo Electron were among the top gainers.

Adding to that, the other major index Nikkei 225 hit an intraday high of 30,924 points on Friday morning after a 1% gain, posting its highest since November 2021 led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass.

By surpassing the key 30,000 psychological level for the first time in 20 months on Wednesday morning, Nikkei 225 index has boosted its recent bullish momentum while attracting more trend-focused traders and momentum speculators.

Nikkei 225 index, Daily chart

The broad-based rally in the Japanese stocks has been driven by resilient economic fundamentals, strong corporate earnings, solid domestic demand (despite the global turmoil), zero-interest rates, and the global risk-on mood following the optimism over a U.S. debt ceiling deal.

Nikkei 225 index has gained nearly 15% since March lows (after the turmoil in the U.S. banking sector), and 20% in 2023 so far, as foreign and domestic investors fled to Japan’s stocks for protection or a portfolio hedge against the growing risk of a global recession and geopolitical concerns.

The softening Yen, which hit a six-month low of ¥138 against the dollar this morning on dovish BoJ, also gives big support to the export-oriented Japanese economy, making domestic products less expensive for buyers with foreign currencies.

Overall, the stronger corporate earnings together with the supportive ultra-loose monetary policy by the Bank of Japan boost Topix’s and Nikkei’s bullish and safe-haven appeal and add steam to the recent stock market rally.

Bullion retreat from yearly highs on a stronger dollar and U.S. debt optimism

Posted on by Vrasidas Neofytou

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Silver, 4-hour chart

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Silver, 4-hour chart

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Silver, 4-hour chart

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

A rebounding U.S. dollar and the improved market risk sentiment have added some pressure on the dollar-denominated bullion, with the prices of Gold falling as low as $1,974/oz and Silver to a three-month low of $23.40/oz on Thursday morning.

Silver, 4-hour chart

The growing optimism after the tentative progress over the increase of the U.S. debt ceiling has eased fears for a debt default in the world’s largest economy, damaging the precious metal’s safe-haven appeal, and triggering a mini stock market rally during Wednesday’s session.

Adding to that, the DXY-U.S. dollar index which tracks the value of the greenback against a basket of six major peers has bounced back to the 103 regions, its seven-week high, recovering most of the losses after early March’s banking crisis and the collapse of several small regional U.S. banks.

Despite worries over the health of the U.S. banking sector and a series of weak economic data, the dollar has gotten some boost this week following several hawkish comments and signals from Fed officials amid the resilient inflation. The hawkish stance supports dollar and bond yields against the non-yielding precious metals, adding another selling pressure on their prices.

Historically, the soaring or falling dollar makes the dollar-denominated gold and silver more or less expensive for buyers with foreign currencies respectively.

However, gold and silver still hold most of 2023’s gains amid the growing bets for safety following the recent banking turmoil coupled with the economic and political uncertainty, in a time when the strength of the greenback eased.

The bullish bullion fundamentals pushed the price of gold to nearly all-time highs of $2,070/oz in early May, while the white metal -silver- hit a 12-month high of $26/oz in the same period, before retreating lower by 5% and 10% respectively.

Euro trade below $1.09 on economic and political uncertainties

Posted on by Vrasidas Neofytou

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The risks of global recession and the worries over the U.S gov’t debt-ceiling talks gave a boost to the safe-haven greenback against the risk-sensitive euro, which has retreated from early-May one-year highs of $1.11 mark to the current lows of $1.0850.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The risks of global recession and the worries over the U.S gov’t debt-ceiling talks gave a boost to the safe-haven greenback against the risk-sensitive euro, which has retreated from early-May one-year highs of $1.11 mark to the current lows of $1.0850.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

The EUR/USD pair fell as low as $1.0850 on Monday, posting its lowest level since early April as the market sentiment remains fragile on economic and political uncertainties, coupled with the concerns over China’s outlook.

The risks of global recession and the worries over the U.S gov’t debt-ceiling talks gave a boost to the safe-haven greenback against the risk-sensitive euro, which has retreated from early-May one-year highs of $1.11 mark to the current lows of $1.0850.

EUR/USD pair, Daily chart

The risk sentiment has also deteriorated by the weaker-than-expected macroeconomic data from the key trading partner China, weighing on export-oriented economies like Euro Zone and adding pressure on its currency.

Adding weakness to the euro, Chinese industrial output, retail sales, imports, and inflation all shrank in April, indicating that a post-pandemic rebound was running out of steam.

As a result, the DXY-U.S. dollar index which tracks the greenback against a basket of six major peers – the euro has the greatest weight in the dollar index- bounced off a yearly low of 101 towards the five-week high of 102.50.

 

Positive EU fundamentals:

The market has dismissed some positive data about Eurozone, where the European Commission upwardly revised its quarterly projections for Eurozone’s economic growth and inflation for 2023 to 1.1% and 5.8% versus 0.9% and 5.6% expected in February.

Hence, the European Central Bank (ECB) also released its monthly Economic Bulletin offering details on the economic, financial, and monetary developments in the Euro area while saying, “Most of the impact on inflation is expected from 2023 onward.” The ECB Bulletin also said that the transmission of rate hikes to economic activity is faster.

WTI oil falls to $70/b on recession fears and sluggish demand outlook

Posted on by Vrasidas Neofytou

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

The crude oil complex extends last week’s losses into the fresh week during Monday’s morning trading session, with WTI falling back below the key $70/b level, and Brent dropping to $74/b as growing economic concerns and recession fears offset the prospect of tight supplies from OPEC+, SPR lows, and a weaker dollar.

Both crude oil prices lost nearly 2% last week, sinking for a fourth straight week to levels not seen since December 2021. They are also trading almost 45% lower than 2022’s peaks of $140/b hit a few days after the Russian invasion of Ukraine on February 24, 2022.

WTI crude oil, Weekly chart

The surprised OPEC+’s 1.5 million barrels per day crude oil production cut due in May, the prospects of China’s reopening after the Covid era, and the 40-year low in the U.S. crude oil SPR Inventories, and the falling dollar have failed to reverse the recent downward momentum on the crude oil prices.

Energy traders have become sellers of the growth-sensitive crude oil given the uncertainties around global economic growth, the U.S. regional banking turmoil, and the weaker-than-expected rebound in the Chinese economy after the pandemic which has deteriorated the oil demand growth outlook for the rest of the year.

Not even the fall of the U.S. dollar to 12-month lows against major peers due to the prospects for a less hawkish Federal Reserve and the soured U.S. economic outlook has given any support to the dollar-denominated crude oil prices, as investors have been worrying about the demand-led issues.

What weighs on the oil prices now, is the sluggish demand outlook as China’s economic reopening progress faded. Chinese imports, inflation, and manufacturing activity all shrank in April, indicating that a post-COVID rebound was running out of steam, deteriorating the demand growth outlook for petroleum products.

On the flip side, the energy market looks on the tightening supply side as the OPEC+ members will voluntarily cut output further by around 1.16 million barrels per day, bringing the total volume of cuts to 3.66 million bpd.

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