- Bitcoin hits new all-time high
- US PPI and initial jobless beat forecasts but USD still mixed
- GBP slides after “deadlock” following latest Brexit talks
- DOE drops once more but Oil unimpressed
The main story of the day comes form Bitcoin with the cryptocurrency surging higher by more than 10% to smash through the $5000 barrier and rise to a new all-time high. The market has enjoyed gains of more than 400% YTD and whilst many cynics remain highly critical as to the recent rally, the market is clearly in an uptrend and showing little sign of stopping anytime soon.
Some positive data from across the Atlantic has provided a boost to the US dollar after the greenback earlier fell to a 2-week low. US PPI rose to 2.6% y/y from 1.9% y/y prior with the core reading a particular highlight in beating estimates to rise to 2.1% y/y. Further good news came in the initial jobless claims which fell lower making it 4 of the past 5 readings that have surpassed forecasts.
The Pound has experienced a sharp move to the downside today after the conclusion of the most recent Brexit negotiations between the UK and EU have failed to yield any tangible progress. The talks which ended today mark the 5th round of discussions on Article 50 and the EU Brexit chief, Michel Barnier, stated in a press conference which followed that negotiations have hit a “deadlock”.
A drop in the weekly DOE inventories has provided little clarity for the oil market with price experiencing volatile trade since the release. A decline of 2.7M compared to -1.9M expected and last night’s API reading of +3.1M is clearly positive but the distillate and gasoline components were less supportive of price. Brent Oil dropped briefly below the $56 handle to trade at its lowest level of the day before recovering somewhat to trade back to flat on the day at the time of writing.
Swedish inflation fell short of estimations in September receding a date when a first interest rate hike could take place. Even as both CPI and CPIF stayed above the Riksbank’s target, the SEK tumbled immediately after the release. Moreover, wage growth in the Sweden’s economy suggests that inflation may be slowing down further which could sap the SEK at least in the short term