Markets have had a chance to calm down a little after the strong surges seen earlier in the week. The lower-than-expected inflation figures in the US was welcome news for all and stock markets seem content to rest on their laurels for the time being. All major indices trading flat as we close in on the weekend. Currencies have also been relatively muted since Tuesday, happy to remain rangebound for the time being.
Gold perhaps the exception here as it seems intent on conserving some of its momentum. Rising from the $1940 level on Monday it made another leg up on Thursday to close the day at $1981. Any further news that inflation is finally coming under control would be welcome by traders hoping to see gold reclaim the $2000 milestone.
Completely different story in oil markets in the face of waning global demand. West Texas Intermediate Crude fell almost 5% on Thursday to trade at $73 a barrel. Brent crude now down to $77. US crude inventories continued to rise last week, whereas US industrial production fell 0.6% in October. Crude refining in China also slowed down 2.8% in October.
There is a sense that this week revealed the first signs that inflation may finally be under control but we are by no means out of the woods just yet. With just under one month to go before the next FOMC meeting, the Fed still has plenty of time to monitor the pulse of the US economy. As for this week, news is relatively light with the possible exception of retail sales in the UK later today.
