Week in Review: 8-12 August

This week and the rest of the month aren't expected to bring big news. Market feeling is mixed. The bear market rally seems to be running out of energy, and another descend may occur from September onwards, if recession is confirmed and if the FED signals more tightening.

EU Inflation

Source: CNN

Annual inflation in the European Union jumped to 9.6% in June. It reached 8.6% for the 19 countries that use the euro.

To cap price increases, the European Central Bank is due to start raising interest rates on Thursday for the first time since 2011. But it faces an uphill battle to get the situation under control.

The central bank lags peers like the Federal Reserve, which started hiking months ago. Interest rates in Europe have been negative since 2014, which means it's further behind. And, if a shortage of energy tips the region into recession, the central bank could be forced to abruptly stop hiking rates, hampering its ability to keep fighting inflation.

China Tries to Avoid a Financial Crisis

Source: Seeking Alpha

China lowered two key lending rates and injected more cash into its economy Monday as it looks to keep stimulating the economy. The country remains the global monetary policy outlier, with the rest of the major economies tightening in an effort to tame inflation.

The People's Bank of China cut its one-year lending facility rate by 10 basis points to 2.75% and cut the seven-day lending rate the same amount to 2%. The PBOC added 2 billion yuan through seven-day reverse repos.

Recessions and Social Unrest - A Few Videos

Video: The REAL cause of all recessions (that nobody talks about)

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Video: Sri Lanka's COLLAPSE Is FAR Worse Than You Think, Bankrupt | Global financial crisis is approaching

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Video: Is the Great Reset Happening? - Robert Kiyosaki @Mark Moss

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Economy and Recession

Video: Cathie Wood on the Fed, Economy, Coinbase, Tesla

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Video: Is The Government LYING About The Jobs Numbers? (Shocking Intel Revealed)

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OIL

 

Source: Trading Economics

 

WTI crude futures fell toward $88 per barrel on Tuesday, sliding for the third straight session to near six-month lows, as weak US and Chinese economic data sparked fresh concerns about a potential global downturn that could heavily impact energy demand. China’s factory and retail activity slowed unexpectedly in July, prompting the central bank to cut key lending rates to shore up demand. In the US, the New York Empire State Manufacturing Index posted its second largest monthly decline ever in August. The prospect for increased Iranian oil exports also weighed on prices as Iran responded to the EU’s proposal for reviving the 2015 nuclear deal, calling on the US to show a “realistic approach and flexibility” to resolve three remaining issues. Elsewhere, Saudi Aramco head Amin Nasser said Sunday that the state-owned firm stands ready to raise crude output to its maximum capacity of 12 million barrels a day if the Saudi Arabian government orders it to do so.

Natural Gas

 

Sources: Trading Economics

US Natural Gas futures were trading around the $8.80/MMBtu mark, not far from a 14-year peak of $9.75/MMBtu hit in late July, buoyed by strong overseas and domestic demand. The temperatures in the US this summer remain high, with several heatwaves boosting demand for air conditioners. Meanwhile, Freeport LNG has recently agreed with regulators to partially restart operations in October at its shuttered export plant in Texas and said it began to pull in tiny amounts of natural gas from pipelines. The resumption of flows will withdraw more natural gas from storage and boost exports. Adding to woes, demand from Europe remains strong as the critical Nord Stream 1 pipeline from Russia to Germany is currently running at 20% capacity.

 

 

 

Markets

 

Source: Trading Economics

US stock futures drifted lower on Tuesday after the major averages posted gains in the last regular session, while investors braced for retail earnings that could offer clues about consumer activity and the overall health of the US economy. Futures contracts tied to the three major indexes drifted flat to slightly negative. In after-hours trading, job search engine ZipRecruiter fell more than 5% as it slashed its full-year revenue guidance, while real estate brokerage firm Compass dropped 12% after reporting a wider loss for the second quarter. In regular trading on Monday, the Dow rose 0.45%, the S&P 500 gained 0.40% and the Nasdaq Composite added 0.62%. Those moves came as investors shrugged off dismal economic data from China and the US and remained focused on easing price pressures. Investors now look ahead to earnings reports from major retailers, with Home Depot and Walmart scheduled for Tuesday. Markets also await minutes of the last Federal Reserve meeting due on Wednesday.

Crypto

 

Source: Trading Economics

Bitcoin US Dollar traded at 23897 this Tuesday August 16th, decreasing 172 or 0.71 percent since the previous trading session. Looking back, over the last four weeks, Bitcoin lost 14.21 percent. Over the last 12 months, its price fell by 46.51 percent. Looking ahead, we forecast Bitcoin US Dollar to be priced at 22335 by the end of this quarter and at 16386 in one year, according to Trading Economics global macro models projections and analysts expectations.