US
crude prices haven’t skipped a beat on Monday, as the commodity
continues to lose ground. In North American trade, WTI/USD futures are
trading at $42.36. Brent crude futures are trading at $43.58, as the
Brent premium stands at $1.22. On the release front, it’s a quiet start
to the week, with no US events on the schedule. On Tuesday, the US will
release key retail sales numbers.
Oil
prices continue to slide, as US crude has fallen close to the $42 line,
its lowest level since August. The commodity has plunged a whopping 9.1 percent so far in November. The Trump election win has caused turmoil in the markets and sent oil prices lower, and unexpectedly large surplus in US crude inventories have also weighed on crude prices. As well, there is increasing skepticism that OPEC members will revert to old habits and won’t be able to reach a production cap agreement when they meet in late November. On Friday, OPEC said its output
hit a record
33.64 million barrels per day in October. Recently, OPEC said that it
expects the crude oversupply to continue in 2017. If the cartel fails to
reach an agreement, the slide could continue and oil prices could fall
as low as $35 a barrel.
its lowest level since August. The commodity has plunged a whopping 9.1 percent so far in November. The Trump election win has caused turmoil in the markets and sent oil prices lower, and unexpectedly large surplus in US crude inventories have also weighed on crude prices. As well, there is increasing skepticism that OPEC members will revert to old habits and won’t be able to reach a production cap agreement when they meet in late November. On Friday, OPEC said its output
As the shock
of a Trump presidency begins to wear off, investors and traders are
asking what will a Trump election mean for the markets. Like much of his
agenda, Trump’s economic platform is unclear. According to Bank of
America Merrill Lynch, given that both houses of Congress are under
Republican control, we could see Trump opt to loosen fiscal policy. This
would lead to greater spending,
causing more inflation. In turn,
interest rates would move higher and bolster the US dollar. However,
Trump remains an enigma, having never held public office. His ideology
is unclear (if he has one), so the markets could be in for a period of
uncertainty, at least in the early stages of the Trump administration.
This could lead to prolonged volatility in the currency markets. As far
as monetary policy is concerned, the odds of a rate hike in December
also showed some volatility immediately after the election, but have
jumped to a remarkable 85 percent, as all signs point to the first hike
since last December.
