Last Week Will Be Remembered by Negative Oil Quotes (Weekly Review)

2020-04-29
No doubts the main event of the past week was an unprecedented drop in oil prices to negative values. The world spread of coronavirus provoked a rapid drop in energy demand - airlines significantly reduced flights, residents of many countries due to quarantine began to use their own vehicles less, and transport communication was suspended.

In addition, the oil war between Saudi Arabia and Russia led to an increase in oil production, and there was a problem with its storage. Thus, sales of the May futures collapsed its quotes to a negative value, and spot prices fell below $ 10 per barrel. After a short correction, prices for black gold remain under pressure, because the vaults are quickly filling up, and soon they will have nowhere to store it. A large-scale reduction in OPEC + may improve the situation, but the pressure will remain in the short term.

Relative calmness prevailed in the foreign exchange market. The USD was in moderate demand, while the EUR, the GBP, and the CHF were mostly falling. The stock markets, despite the situation, are trying to develop a larger recovery, but it is unlikely that corporations can expect the same levels of profit, so stock sales are still possible. This will positively affect the dynamics of the JPY, which, despite the lifting by the Bank of Japan of restrictions on the purchase of government bonds, is already growing across the entire spectrum of the market.

Schedule for this week:

Monday, April 27 
14:30 GMT - USA. Dallas Fed Mfg Business Index.

Tuesday, April 28
23:30 GMT - Japan. Unemployment Rate;
08:00 GMT - Eurozone. Bank Lending Survey (BLS);
14:00 GMT - USA. Consumer Confidence.

Wednesday, April 29
22:00 GMT – New Zealand. ANZ - Roy Morgan Consumer Confidence (Apr);
01:30 GMT - Australia. RBA Trimmed Mean Core Inflation Index;
01:30 GMT - Australia. Consumer Price Index (CPI);
12:00 GMT - Germany. Harmonised Index of Consumer Prices (HICP);
12:30 GMT - USA. GDP (Q1);
18:00 GMT - USA. Fed Interest Rate Decision;
18:30 GMT - USA. FOMC Press Conference.

Thursday, April 30 
23:50 GMT - Japan. Industrial Production;
23:50 GMT - Japan. Retail Sales;
06:00 GMT - Germany. Retail Sales;
09:00 GMT - Eurozone. Core Consumer Price Index (CPI);
09:00 GMT - Eurozone. Consumer Price Index (CPI);
09:00 GMT - Eurozone. Unemployment Rate;
09:00 GMT - Eurozone. GDP;
11:45 GMT - Eurozone. ECB Interest Rate Decision;
12:30 GMT - Eurozone. ECB Press Conference and Monetary Policy Report;
12:30 GMT - USA. Initial Jobless Claims.

Friday, May 1
23:50 GMT - Japan. Tokyo Consumer Price Index (CPI);
08:30 GMT – United Kingdom. Markit Manufacturing Purchasing Managers Index (PMI);
14:00 GMT - USA. ISM Manufacturing Purchasing Managers Index (PMI).

Author: Anthony Porter, IAFT Analyst

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