August 8, 2020

Oil prices rise despite the weekly drop> Forex Highlights

Oil prices rise despite the weekly drop

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Oil prices rise despite their weekly drop for a third consecutive week amid concerns over trade dispute and oil surplus. US-China trade war and the lower oil demand weighed on oil markets.

The U.S. is fifth in the list of global oil demand, while China consumes approximately 13%[1]. Prices supported by comments from Saudi Arabia, the world’s biggest oil exporter, that it would cut crude shipments.

Trump to invite Putin despite the political rage over Helsinki summit

Trump failed to hold Russian President Putin accountable for meddling in the 2016 U.S. election during their joint news conference. Then, he tried to calm down the political firestorm triggered by several critics due to his stance in Helsinki summit. He said that he had misspoken, although he did not correct himself until 27 hours later.

Surprise! The White House said on Thursday that Trump had invited Putin to visit Washington this autumn! Further, it seems that no-one knows what happened at Trump-Putin one-on-one meeting with only interpreters, not even top officials.

Brexit – Irish Border issue

The Irish border issue is one of the issues that UK and EU must solve ahead of Brexit. Today, the UK Prime Minister is expected to say that the British won’t accept the EU’s so-called backstop plan. The plan provides a “soft” border between Northern Ireland, leaving the EU as UK part, and the remaining Republic of Ireland. May considers it unacceptable and instead proposes that any backstop plan should apply to the entire UK.

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FOREX MARKETS – Oil Prices rise

The dollar remained just below the one-year high it reached in the previous session following Trump’s expressed concerns about a stronger currency. The greenback rallied for a second, consecutive, week. However, analysts at Morgan Stanley foresee a weaker USD in coming weeks.

The Australian dollar slightly changed, compensating losses from the during early trade.

The Sterling traded flat near 10-month low after a hard week due to weak inflation data and rallying dollar. The pound remained almost unchanged against the common currency amid Brexit concerns.

Oil prices traded flat despite their weekly drop for a third week amid concerns over trade dispute and oil surplus.

Sources: Reuters, CNN money, the guardian

PLEASE NOTE The information above is not investment advice.

[1] BP Statistical Review of Energy