{"id":33099,"date":"2022-06-23T09:11:05","date_gmt":"2022-06-23T06:11:05","guid":{"rendered":"https:\/\/ironfx-com-php8.wp-dev.int.theitops.net\/?p=33099"},"modified":"2025-10-17T09:30:06","modified_gmt":"2025-10-17T06:30:06","slug":"oil-prices-drop-as-recession-worries-intensify","status":"publish","type":"post","link":"https:\/\/www.ironfx-id.com\/vi\/oil-prices-drop-as-recession-worries-intensify\/","title":{"rendered":"Oil prices drop as recession worries intensify"},"content":{"rendered":"

The USD remained relatively stable yesterday against a number of its  counterparts, as Fed Chairman Jerome Powell\u2019s testimony before the US Congress was hawkish yet within the market\u2019s expectations. In his testimony the Fed Chairman stated that the bank is strongly committed in curbing inflationary pressures in the US economy while also noted that a recession is a possibility. Overall the Fed\u2019s path to avoid a possible recession may still be possible yet may at the same time prove to be a difficult one. US stockmarkets ended their day with low volatility being also under pressure from the market\u2019s worries maybe with the exception of Nasdaq that slipped a bit yet recovered the lost ground during today\u2019s Asian session. Oil\u2019s price tumbled yesterday as recession fears tended to intensify also worries for the demand side of the commodity, while it should also be noted that the US President Biden asked Congress for a gas tax holiday to lower fuel prices at petrol stations. At the same time it should be noted that the API crude oil inventories reading for past week, showed a considerable rise of oil inventories which may have also played a detrimental part in oil\u2019s price as it may imply a slack in the US oil market where, production surpasses demand levels, while today we get the EIA crude oil inventories figure for past week. Today we note for EUR traders the release of the preliminary PMI figures for June and should their readings drop if compared to May, we may see the EUR weakening as the drop would imply a slowdown of the expansion of economic activity in the Area. The heavyweight of the release is to be on Germany\u2019s manufacturing sector which is also considered the locomotive of Eurozone\u2019s economy. EUR traders may keep an eye out for ECB President Lagarde which is to attend the EU Council meeting and could make some statements. From Norway, we note Norgesbanks\u2019 interest rate decision and we would expect the bank to stick to the script and hike rates in the coming meeting as it remained on hold in the last one and CPI rates accelerated further. It\u2019s interesting to see whether the bank\u2019s forward guidance will be tweaked more to the hawkish side, a scenario which could provide some support for the NOK. Last but not least on a more exotic note, we would like to see how the Central Bank of Turkey will behave also today. The bank has maintained its one week repo rate at 14%, with inflation for May accelerating further and reaching 73.50% yoy, while Turkey\u2019s President Erdogan warned that his government will try to lower interest rates even further. Should the bank actually maintain rates unchanged once again we may see the Lira starting to weaken. Should the bank show intentions of cutting rates further, we may see the Lira weakening substantially practically sending the Turkish economy in a negative spiral.  <\/p>\n\n\n\n

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