Market update: The US already became the biggest oil producer, India to overtake China in population

13 Sep

by Mihály Tatár

 

Good Morning!

 

  • On the otherwise new normal Wednesday – on which Washington Post blamed President Trump for Hurricane Florence (?) and on a leaked video, Google executives could be seen openly raging against ’bored and racist’ non-Clinton voters  – the market tried hard to avoid any risk before the critical macro events of the next 48 hours (ECB, Bank of England, Turkish Central Bank meetings, US inflation data today and retail sales tomorrow). Stocks and currencies moved in narrow ranges (SPX +0.04%, Nasdaq -0.23%, but Google -1.6%, DAX +0.52%, Shanghai -0.10% even after Washington reached out to Beijing to continue trade talks but many suspect China is rather waiting for the November election results, EURUSD 1.1625 – US producer price data showed no price tensions but the Italian finance minister pressured the government by threatening to resign, GBP 1.3040, WTI 69.90, Brent 79.30 USD with some traders taking profits at the key levels and as the EIA said the US is now the world’s largest global crude oil producer – much sooner than thought before). Polish and Hungarian assets weakened somewhat after the EU parliament vote (Warsaw -1.8%, BUX -3% in two days, EURHUF 325.30, EURPLN 4.31), but traders saw the news as rather a long-term political development and focused instead on the Turkish Lira (strengthening to 6.35 with the market hoping for a dramatic rate hike today – as if that solved anything apart from maybe squeezing lazy shorts – even ignoring the news that President Erdogan got rid of the entire Turkish sovereign wealth fund management and named himself the chairman. One has to wonder what his benchmark will be?).

 

  • Strategists note that India’s population is set to overtake China’s in 3 to 5 years (as of September, India has 1336 million, China 1339 million people), despite the frantic government efforts since 2015 in China to somehow stop the demographic decline (its always easier the other way, isn’t it). Indonesia’s population is also expanding rapidly (from 238 to 265 million within seven years – it had only 77 million people in 1955, European politicians should take notes), and one has to wonder how many electric vehicles would be needed to make ’peak oil demand’ a reality.

 

 

Have a nice day,

Mihály

 

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