For the week of April 18 to 22
The much anticipated oil production freeze meeting in Doha resulted in no agreement between representatives from 16 oil producing nations. After the 12th tense hour passed in what was scheduled to be a much shorter meeting, it seems that Saudi Arabia was not willing to freeze without the absent Iran’s participation. This lack of agreement will likely signal to the markets the concerning truth of the lack of cooperation between OPEC and non-OPEC members. This was the first attempt at a meeting of coordination in 15 years. Out of approximately 40 surveyed analysts, about half foresaw this as the outcome. Many are blaming geopolitical tensions that exist between Saudi Arabia and Iran as being a large factor in this agreement failure. The next chance for these nations to reach an agreement will be at a meeting scheduled for June 2.
Oil prices were down sharply on the news, but were helped by a strike by oil workers in Kuwait that brought their production down by 60 percent. Prices were down by as much as 6.8 percent, but are now down a lesser 4.36 percent to $38.60 per barrel. The Canadian dollar, along with currencies of other oil producing countries such as Australia and Russia, fell in reaction to the meeting and is currently down around 0.8 percent against its United States counterpart. Today’s expected range is 1.2834 – 1.2934.
This week, the ECB will be holding their meeting on Thursday but not much is expected to occur after all of the measures introduced by Draghi at their most recent meeting. Housing Starts data is expected out of the United States tomorrow morning. Strong housing data will help give us yet another indicator of how the United States economy is fairing following weaker than expected data as of late. Canada will be releasing data for consumer prices and retail sales on Friday. Consumer prices are expected to have risen by 0.5 percent for the month of March. Retail Sales likely fell by 0.8 percent in February. The province of Nova Scotia will be releasing their budget on Tuesday and the province of Manitoba is holding their election on the same day
Posted by Concentra Financial Markets