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Disappointing US GDP sends dollar plummeting
Last Friday was a consolatory one for the oil market. According to the report from Baker Hughes, the number of active oil drilling rigs rose to 374 (previous: 371). As a result. The last day of July 2016 saw the price of oil fall to $42.5 per barrel of Brent; a minimum since April. It”s likely that this was triggered by a fixing of profit by the bears. By trading close, the price of oil on Friday stood at around $43.3. On Monday morning the price of oil has continued its rise all the way to $43.7. Through this rise, all Thursday”s and Friday”s losses were won back during the Asian session.
At the end of last week, the American market continued to correct, however the first day of August has seen a rise for the markets. The Nikkei 225 has risen by 0.2%. The ASX Australia is up 0.5%. The Shanghai Composite has decreased 1.3%, and the Hang Seng is down by 1.3%. Futures for the S&P500 were trading at 2176; 0.4% above the closing level of the previous trading day.
A large deposit of potassium has been discovered in Qīnghǎi province in the north west of China. It is hoped that the rich reserves will aid the potassium deficit situation. Bigger reserves are expected to be discovered. Currently, 70% of all potassium consumed in China is imported. The largest reserves and producers of potassium belong to Canada, Belarus and Russia who together provide 60% of the market supply.
The USD was trading down against the yuan this morning at 6.6328 (-0.0022 or -0.03%).
A dramatic fall occurred for the dollar on Friday, caused by the disappointing US GDP in Q2 of 2016. The data showed a 1.2% YoY rise, with it expected to be at 2.6%. This massive difference sent the dollar plunging. The EURUSD rose on Friday from 1.1070 to 1.1190 and on Monday it is trading in a 1.1165-1.1180 range. At the start of the American session this evening some business activeness data for the manufacturing sector and inflation stats will be published by the ISM.
