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The EIA natural gas inventory change in the United States for the week ending April 25 was 107 billion cubic feet, the largest increase since the week ending May 26, 2023.The EIA natural gas inventory in the United States for the week ending April 25 was 107 billion cubic feet, which was expected to be 107 billion cubic feet and the previous value was 88 billion cubic feet.The U.S. two-year Treasury yield rose 10 basis points to 3.7% during the day.May 2, despite OPECs long-awaited plan to increase production, its crude oil production fell last month, with most of the reduction due to the upcoming US sanctions on Venezuela. A survey showed that OPECs production fell by 200,000 barrels per day in April to 27.24 million barrels per day. Venezuela accounted for about half of the decline in production as international oil producers such as Chevron scaled back their operations as the Trump administration tightened sanctions. However, it is not clear why other OPEC members such as Saudi Arabia and the United Arab Emirates did not take advantage of the agreement reached by the organization to eventually increase supply. The survey showed that the UAE - which even received special discounts for additional production increases - instead reduced production by 80,000 barrels per day to an average of 3.25 million barrels per day. Saudi Arabia only increased production by 20,000 barrels per day, with a production of 8.97 million barrels per day, which is only a part of the agreed production.The Federal Reserve accepted a total of $157.353 billion from 37 counterparties in fixed-rate reverse repurchase operations.

EUR/USD Expects Fourth Weekly Gains Above 1.0900 Despite The US Dollar's Rebound Advance Ahead Of US NFP

Daniel Rogers

Apr 07, 2023 11:42

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Despite a recent retreat, the EUR/USD bulls maintain control around 1.0920. This reflects the typical Good Friday inactivity and apprehension ahead of the US Nonfarm Payrolls (NFP) report released early in the day. The major currency pair was volatile on Thursday as a result of the US Dollar's initial rebound on fears of a recession, but ended the day unchanged as disappointing US data contrasted with stronger Eurozone data.

 

Fears of a recession in the world's largest economy were prompted by consecutive lackluster US data and falling US Treasury bond yields, giving USD bears a reprieve on Thursday morning. As traders prepared for the all-important NFP, the dollar's subsequent gains were reversed by another disappointing US employment report.

 

Despite this, US Initial Jobless Claims for the week ending March 31 rose to 228K from 200K anticipated and an upwardly revised 246K the prior week. Notable is the increase in Challenger Job Cuts from 77,77K to 89,703K in the given month.

 

Notably, Reuters fanned fears of a recession by citing the most recent decline in the preferred bond market indicator of Federal Reserve (Fed) Chairman Jerome Powell. The most reliable bond market indicator of an imminent economic contraction, according to Federal Reserve research, is the "near-term forward spread" between the forward rate on Treasury bills 18 months from now and the current yield on three-month Treasury bills.

 

According to Reuters, International Monetary Fund (IMF) Managing Director Kristalina Georgieva stated in prepared remarks on Thursday that the global economy is projected to expand by less than 3% in 2023, a decrease from 3.4% in 2022.

 

In other news, Germany's Industrial Production (IP) increased 0.6% year-over-year in February, versus market predictions of -2.7% and previous readings of -1.7%. Additionally, the monthly figures exceeded expectations by 0.1%, coming in at 2.0% compared to 3.7% previously. On Wednesday, Germany Factory Orders for February improved to -5.7% YoY from -12.0% previously revised down and -10.5% market expectations, while MoM growth came in at 4.8% compared to 0.3% expected and 0.5% previous readings.

 

Wall Street and US Treasury bond yields have both reduced weekly losses as a result of these strategies, but investors remain skeptical.

 

In the context of less liquidity surrounding the March US employment report, sporadic activity on the major markets can keep the EUR/USD inactive and prone to abrupt price swings. Notable is the fact that recent dovish Fed forecasts and disappointing US data generate expectations for a positive surprise and enormous price volatility thereafter.


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