Oil below $28, kiwi tumbles on weak inflation

Market sentiment turned sour again in Asian trading on Wednesday, leading to a flow to safe haven assets such as the yen and gold.

The cautious mood also saw the Japanese yen strengthen 0.3 per cent to Y117.26, making it the best-performing regional currency this morning while gold was 0.4 per cent stronger at $1,091.38 an ounce.

The gains in oil in US trading yesterday proved unsustainable. West Texas Intermediate, the US oil benchmark, traded as low as $27.92 a barrel this morning. WTI was down 1.8 per cent at $27.96, but its early tumble saw it trade below $28 for the first time since September 26, 2003. Brent, the international benchmark, was down 0.5 per cent at $28.61. On Monday, Brent traded below the $28 mark for the first time also since September 26, 2003.

Focus today was also on the New Zealand dollar which fell 0.6 per cent. It was the worst performing Asian currency after data showed inflation in New Zealand slowed to a 0.1 per cent year-on-year pace in the December quarter, its lowest level since the September quarter of 1999.

A weak session on Wall Street overnight caused Asian markets to slump in morning trade. Japan’s Nikkei was down 1.9 per cent, while Australia’s S&P/ASX 200 surrendered early gains and fell 0.6 per cent. Hong Kong’s Hang Seng was 2.4 per cent lower, while on the mainland, the Shanghai Composite was off by 0.2 per cent and the tech-focused Shenzhen Composite was up 0.2 per cent.

The post Oil below $28, kiwi tumbles on weak inflation appeared first on FXTM Blog.

Source:: Oil below $28, kiwi tumbles on weak inflation

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