On Tuesday, Oil prices fell as much as 3% on signs leading oil exporters in the Organization of the Petroleum Exporting Countries were struggling to agree on a deal to curb output. Today, OPEC will meet in Vienna aiming to perform a deal outlined in September to cut output by nearly 1 million barrels per day (bpd), from 33.82 million bpd in October.
On the other hand, Iraq and Iran were resisting pressure from Saudi Arabia to limit oil production, making it hard for OPEC to reach a deal.
U.S. crude fell to $45 at the end of yesterday’s trading session and could decline further to $40, if OPEC fails to reach an agreement. However, if everything goes well, prices could jump to $50.
The U.S. dollar index settled at 101 pips yesterday.
Gold fell on expectations of a Federal Reserve rate hike, which means that investors could prefer assets that involve higher risk, such as stocks.
The yellow metal declined to $1,180 before returning to $1,188. Technically, the precious metal could trade sideways in anticipation of the U.S. non-farm payroll, which will be released this Friday.
GBP rose vs. USD and traded between $1.26 and $1.23. The British pound rose slightly as lending to Britons expanded last month at the fastest annual pace in 11 years, supporting the picture of resilient consumer demand after June's Brexit vote.
Euro is awaiting important inflation rates in the Eurozone and ECB President Draghi's speech, with anticipation of the Italian referendum next Sunday.
The most important economic events:
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM Capital Limited. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.