US Market Wrap: EIA report maims oil and spooks FX
- Japan: Bank lending, Current Account and Trade Balance 2350 GMT
- ADP Employment change (Actual 172000 vs forecast 159,000)
- Initial Jobless claims (Actual 254,000 vs. forecast 270,000)
- EIA Crude Oil Stocks change (-2.22 m/b vs. previous gain of $.05 m/b)
Traders started having second thoughts about selling dollars and some openly wondered, “what the heck is cable doing above 1.3000?”.
But when the EIA announced a 2.22 million barrel drawdown in weekly crude stocks there were no more second thoughts or concern about cable’s level. The US dollar soared.
Perhaps the trigger was the line in the EIA statement that said “US crude inventories are at historically high levels for this time of year”. Prior to the data release, WTI was drifting higher and had touched $48.32 before the bottom fell out of the barrel.
It hit a low at $44.87 before clawing its way above $45.00.
-- Edited by Adam Courtenay