We have long held the view that oil prices ought to test and even briefly penetrate the $90/bbl milestone in the third quarter of the year. Continuous OPEC+ cuts, growing confidence in lowering borrowing costs in several developed economies and seasonally strong thirst for refined products have all been part of this bullish jigsaw puzzle.
This morning seems to greet a market that is holstering ambition in investment as political shenanigans in the United States coupled with uncertainty in economic growth in the likes of China keep markets guessing.
Everything, literally everything pales in relevance when it comes to auspicious inflation readings. Both the pound and the euro strengthened against the dollar as inflation in the UK remained at the target level making the lowering of the borrowing cost from the current 5.25% ever more plausible. In the common currency area headline inflation edged lower to 2.5% and core stayed at 2.9%.
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