Eyes on the Sterling Pound as new chancellor set to make announcement
The pound remains in the spotlight this week as investors await today's speech from the new chancellor Jeremy Hunt where is expected to announce the new budget and tax plans after the recent plans caused a noticeable drop in confidence towards the currency. While there may be a possibility for some surprises in today's statement, expectations remain for a U-turn on several measures previously announced in an attempt to reassure markets about the financial stability of the economy. The pound started the day trading higher reaching 1,125 against the US dollar while the UK FTSE index pulled back slightly after an initial upward move which saw it briefly break above 6900 points and any unpredicted announcement could cause a significant reaction across asset classes.
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Oil prices attempt to rebound at the start of the week
Despite the announcement of a further cut to OPEC+ production in the most recent meeting, oil prices failed to gain momentum and after a brief attempted recovery remained stuck in the previous consolidation area. WTI prices are down around 1,50% after a short upward move this morning which was facilitated by a temporary weakening of the US dollar, which has been putting pressure on commodity prices in recent times. However, the situation appears to be changing as the dollar has once again started to garner some strength and is once again pressuring other currencies as well as commodities like oil. Prices could continue to be volatile in the near future as general economic uncertainty and investor sentiment continue to play a key role in price action while investors await macroeconomic reports and central banker speeches during the week, along with earnings reports from major Wall Street companies. Oil WTI prices are hovering in an interesting technical position as they test a short term support area around $84,50, which managed to limit the most recent downward movement. If this area is broken, it may lead to the start of a bigger move which may result in further speculation regarding the upcoming production targets set by OPEC+.
