There were some notable movements in the currency and oil markets this morning as economic data and news releases impacted prices.
Oil prices fell back down, dropping below $30 a barrel on news that major oil producing countries reached a deal to freeze output. A meeting of oil ministers from Saudi Arabia, Russia, Venezuela and Qatar early today in Doha concluded with a conditional agreement to freeze production at January levels. Investors were disappointed as they expected more out of the meeting, such as production cuts, and so oil was sold. Prices on US oil futures touched as low as $29.54 after hitting as high as $31.46 earlier this morning.
The UK published inflation data today. While the headline annual figure showed inflation edged higher in January, the monthly and core numbers disappointed. CPI rose 0.3% on a yearly basis but fell 0.8% month-on month, more than forecast. Core CPI dropped 1.0% month-on-month and fell to 1.2% on a year-on-year basis. The mixed data resulted in the pound dipping against the dollar to $1.4462 immediately after the release. Prices then headed another leg lower to a session low of $1.4443 before steadying. Earlier in the session sterling hit a high of $1.4515 after rising from the European session open of $1.4409.
Data out of Europe showed that German economic sentiment fell in February. The ZEW index came in at 52.3, missing expectations for a reading of 55 and was below January’s reading of 59.7. Concerns over the health of the global economy weighed on investor sentiment in Europe’s largest economy. Despite the data, the euro traded near the session highs against the dollar above $1.1180.
Focus now turns to US session data on the Empire State manufacturing index and the NAHB Housing Market Index
Risk Warning: Forex, Commodities, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full Risk Disclosure.