The economic indicator calendar is still very sparse today so investors’ attention is focused on the energy market. At the request of Saudi Arabia, the major oil-producing nations have been in talks since yesterday to discuss compliance with production quotas. The production limit compliance rate was only at 86% in July and the cartel’s production is now at its highest level this year. Since June 21, WTI crude oil prices have risen by 17.5% and an inability to comply with production targets could open the door to profit-taking.
During a conference held yesterday, St-Louis Fed president James Bullard stated that he was ready to start the process of reducing the size of the U.S. Federal Reserve balance sheet in September. He also mentioned that this would be a gradual process, and that the impact on markets should be limited. Minneapolis Fed president Neel Kashkari said he was concerned with inflation being below the target of 2% and preferred the status quo for the remainder of 2017.
Emmanuel Tessier-Fleury