Summary:
- Brent Oil earlier hit 2017 peak before reversing lower; inventory data in focus
- Another major up-day seen in the Crypto markets led by LTCUSD and ETHUSD
- However, Litecoin founder urges caution to bulls
- US inflation rises and sinks Gold to new lows
- SEK soars as inflation beats estimates
- GBP dips despite inflation hitting 5 year high
A burst pipeline from the North sea has brought about some heightened volatility in the oil markets of late with Brent rallying today to its highest level since the summer of 2015. The market has been hit by a wave of selling this afternoon however and has fallen nearly $2 from the recent peak. Oil.WTI has been a little more quiet but with two lots of US inventory data due out in the next 24 hours the market could spring to life. A technical overview of Oil.WTI can be found here.
The Bitcoin mania keeps going after a launch of future contracts at CBOE in the past weekend, however today Litecoin and Ethereum have stolen the show. Some reports that the CBOE and CME have plans afoot to introduce futures on these alt-coins has been attributed in some corners as the cause of today’s rally which has seen Litecoin surge by more than 50% and Ethereum by 30%.
The rise in Litecoin is nothing short of sensational with the market gaining almost 300% since Friday. However, before Litecoin bulls get too carried away it could be an idea to heed a warning from the founder, Charlie Lee, who tweeted out a message of caution last night.
The latest inflation data from the US has come in above forecast with the PPI Y/Y reading hitting its highest level since January 2012. The 3.1% increase was comfortably above the 2.9% expected and with a prior reading of 2.8% there is growing evidence of increasing inflationary pressures in the US. The news has done little for the US dollar which is little changed on the day but it has applied more downward pressure on Gold which has fallen through the 1240 level to hit its lowest level in almost 5 months.
The Swedish Krona has been rising today following some supportive data. A surge came on the heels of unexpectedly strong inflation releases pointing that price growth came back again to the Riksbank’s objective, the move which could be conclusive in terms of the future of the ongoing bond buying programme.
In defiance of expectations UK headline inflation accelerated in the past month to its five and a half years peak forcing BoE governor Mark Carney to explain why price growth deviated more than one percentage point from the official inflation target. As a result, the UK 10Y yield jumped 2bps while the British currency gained a foothold but it handed back increases afterwards.