US Dollar is still King
The US dollar has been the direction giver for the market in the last couple of weeks and today was no different. We have seen the US dollar trading below 0.99 against the Euro as the market is turning more risk averse every day and moving into the US dollar. This risk aversion has meant that the Rand has again touched a new high this year of R17.46, and we expect that high to be tested regularly with the risk sentiment currently in the market. Even with the ECB poised to hike interest rates by 75 basis points, we have seen little in the way of the market shifting toward some Euro strength and cementing the stronger US dollar at the moment.
Brent Crude breaks below $90 per barrel
With renewed recessionary fears and rate hike expectations, we have seen that the market expects demand for commodities like oil to start to wane. This is the lowest oil price since Russia invaded Ukraine earlier in the year. Even with OPEC cutting supply by 100,000 barrels a day earlier in the week, we are getting to a stage where future economic conditions are not looking to flash, and lack of demand going forward will weigh heavily on prices.
