Oil weaker as Iran ups Oil production

Mar 14, 1:30 pm
Iran Oil

Today’s Economic events

  • Eurozone industrial production m/m 210% vs. 1.50%; y/y 2.80% vs. 1.40%

Coming up

  • RBNZ Governor Wheeler speech

The markets opened on a modest note today with the Asian and European session staying flat for the most part. Over the week, China’s industrial production numbers showed a weaker than expected growth rates of 5.40% and 10.20% for industrial production and retail sales respectively, coming lower than 5.70% and 10.80% forecasts. The weak data was however offset by comments from Chinese regulator who pledged to prop up the markets. This sent the Shanghai Composite index to close higher for the day with 1.76% gains while the Nikkei225 gained 1.74%.

On the currency front, the Yen was seen trading flat as the Yen initially weakened with USDJPY touching highs of 114 briefly before losing ground. USDJPY is currently down -0.14% for the day, ahead of the BoJ’s monetary policy meeting due early tomorrow. The commodity risk currencies are both trading lower. AUDUSD is down -0.25% giving back its early gains after testing highs above 0.757. The NZDUSD also saw similar moves, with a session high test to 0.676 before pushing lower against the Greenback.

In the European session, data included the Eurozone industrial production which came out better than expected. Industrial production increased 2.10% in January above the 1.50% expectations while on a yearly basis, industrial production surged 2.80% above 1.40% forecasts. The Euro was, however, unimpressed with the data as EURUSD remained weaker, down -0.33%. The single currency is trading at $1.1116 at the time of writing but remains within Friday’s trading range.

The GBPUSD also got off to a slow start, currently down -0.14% following Friday’s highs to 1.4425. European equity markets were stronger as the DAX gained 1.34% while the London FTSE100 saw modest gains of 0.28% at the time of writing.

The NY trading session is expected to remain calm with no major news to go by. The pre-market futures are however pointing to a weaker open with the Dow Jones down -0.16% and the S&P500 futures down -0.24% for the day.

On the commodity front, Oil prices are under pressure as Iran dashed hopes of a quick deal on Oil production freeze. The country announced that it would increase its Oil production by nearly 33.0% from February’s levels. The move comes as Saudi Arabia and Russia among other countries are expected to push on with the next round of talks to freeze Oil production. WTI Crude Oil prices are currently trading at $37.47, down -2.73% for the day.

Gold prices continue to remain volatile with gains of 0.61% today, following Friday’s declines off the highs above 1279 after prices settled near 1250 by Friday’s close. In comparison, Gold is currently attempting to push higher but remains within Friday’s trading range.

The remainder of the evening is expected to see no major market shaping news with the exception of RBNZ Governor, Wheeler due to speak in Auckland.

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John has over 8 years of experience specializing in the currency markets, tracking the macroeconomic and geopolitical developments shaping the financial markets. John applies a mix of fundamental and technical analysis and has a special interest in inter-market analysis and global politics.

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