This week, a number of things happened in the markets. This article will highlight a few of those issues.
Deutsche bank is the biggest bank in Germany. In the past few years, the bank has experienced a number of issues, including large fines from the US, huge scandals, and reduced profitability. Yesterday, authorities in Germany raided its offices in Frankfurt. While details of the investigation were still unknown, the bank confirmed that they had to do with its role in the Panama Papers. These were leaks that showed how powerful elite was hiding money in tax havens around the world. The bank’s share price declined sharply as the police and other government agencies made the raid.
Crude oil had a tough week this week as traders continued to worry about the oversupply issue. This week, data from the American Petroleum Institute (API) and the Energy Information Administration (EIA) showed that inventories in the US were rising. The two agencies showed that inventories climbed by more than 3.45 million barrels. This was a testament that the US is set to continue dominating the oil and gas industry. This will likely continue in the coming year as key pipelines are set to be opened. However, in the short term, there could be a relief in the oil market as OPEC leaders meet in Vienna.
Traders focused on the G20 meeting, which is happening in Argentina. This is a meeting that brings together the leaders of the biggest economies in the world. It includes NATO allies together with their rivals like Russia and China. While the meeting will produce major headlines, traders are focused on the meeting between US and China. This meeting is intended to help reduce the global tensions on trade. They are also focused on the pronouncements about crude oil.
This week, investors also focused on Brexit. This was after the Europeans voted to accept the proposed draft between the EU and UK. It was Theresa May’s turn to sell her deal to the voters. In various testimonies and interviews, she said that this was the best deal anyone would have made. A government report later reported that the deal will shave off about 4% of the country’s GDP in the long term. While this was bad, it was better than the other scenarios. The proposed Canada-style agreement would reduce the GDP by more than 6% while exiting without a deal will reduce the GDP by 9%.
It was an important week for the Federal Reserve. On Tuesday, Fed’s Raphael Bostic addressed the Economic Club of New York and said that he would support the Fed’s continued pace of interest rates. He also said that the Fed was unsure about what the neutral rate is. On the following day, the Fed chair addressed the same organization and said that the neutral rate was nearing. This was a dovish statement that came a day after he received criticism from the US president. In the coming days, the Fed will raise interest rates and provide guidance on next year’s raises.
The post Weekly Review: Focus Turns to Deutsche Bank, Crude Oil, Brexit, and Federal Reserve appeared first on Forex.Info.
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