The dollar began the session averaging $3,766.10, up by $17.95 from today’s Representative Market Rate (TRM) of $3,748.15.
The opening price on the Set-FX platform stood at $3,765, with the day delivering a high of $3,770.50 and a low of $3,760. Throughout the session, $7.7 million changed hands across 30 trades.
Energy equities slipped as crude prices retreated, while the Biden administration weighed a large-scale drawdown of U.S. crude stocks to curb inflation pressures.
Treasury bills strengthened as the dollar advanced. Russian equities rose after the country eased some restrictions on short selling, lifting a constraint that had helped limit losses after a record close.
News that Washington is weighing a daily release of about one million barrels of crude helped pare the prior rally ahead of the OPEC+ policy meeting, where the cartel approved its May target. Rising global prices threaten a potential inflation shock reminiscent of the 1970s, according to Brevan Howard Asset Management.
Ukrainian President Volodymyr Zelenskiy accused Russia of aiming to hurt Ukraine’s agricultural sector and possibly trigger a global food crisis. NATO leadership noted that Russian forces have not fully withdrawn from certain Ukrainian regions.
Unemployment claims in the United States rose more than expected last week, though overall levels remain low. Inflation-adjusted consumer spending fell in the prior month as higher prices dampened demand.
“Quarterly assessments aside, oil continues to command a lot of attention,” said Simon Ballard, chief economist at First Abu Dhabi Bank, in a note to investors reported by Bloomberg. He added that the same market forces keep pressure in play, including the ongoing Federal Reserve path toward monetary policy normalization in the months ahead.
Inflation in France hit a new peak, accelerating more quickly than anticipated after surprising upticks in Germany and Spain on the previous day.
Global equities are forecast to close the quarter with losses not seen in two years, amid concerns about slower growth as the Ukraine conflict fuels volatility in commodity markets.
Investors grow cautious about a sharper pullback from stimulus, with the fastest inflation in a generation pushing central banks toward more aggressive rate hikes. Markets now price a strong chance that the Federal Reserve will lift rates by half a percentage point at its May meeting.
Meanwhile, Asian markets faced pressure from softer Chinese data and regulatory concerns. Sources familiar with the matter indicate that Chinese officials are planning to mobilize several hundred billion yuan for a fund to support troubled financial companies.
The organization formerly known as the Organization of the Petroleum Exporting Countries plus allies, including Russia, signaled a steadfast plan for a modest oil production rise in May, according to insiders. The removal of a collection emphasis by the IEA from the data signals a more adversarial posture in Western relations around energy markets.
U.S. West Texas Intermediate crude declined 4.19% to $103.39, while European Brent eased by 3.59% to $107.47.
The group has resisted repeated calls from the United States and the IEA to cool prices, which are nearing all-time highs amid concerns about supply reductions from Russia following sanctions tied to its invasion of Ukraine. One market observer noted that Saudi Arabia is keen to avoid a clash with Russia by adding barrels gradually while Russian production remains constrained.
Saudi Arabia and the United Arab Emirates, holders of much of OPEC’s spare output, have resisted calls to lift production, arguing that the group should stay out of political frictions and focus on stabilizing oil markets.
President Biden’s administration is evaluating up to 180 million barrels from the Strategic Petroleum Reserve, with the IEA scheduled to decide on a bulk crude release at a forthcoming meeting.
Attribution: Lare Publica