Foreign Affairs
Inflation among concerns of international markets

The euro’s trading against the US$ has negatively been estimated at above $1.1950 and is impacting trading markets.

Fears of delays in economic recovery because of negative updates about vaccines as well as geopolitical tensions have added pressure to the situation.

According to Eurostat figures consumer prices during March as a result of inflation was 1.3% on an annual basis, the basic figure being 1.4%.

On a monthly basis, inflation during March was 0.9% while forecasts stated inflation at 1.0%.

According to Reuters, while addressing Parliament earlier today, German Chancellor Angela Merkel requested powers for her to declare lockdowns and curfews in areas reporting a high rate of infections. She said the majority of Germans are requesting stricter measures.

The European Central Bank is to study temporary inflation increases and is expected not to accept increased interest on bonds unless these are directly the result of economic growth. The early purchase of bonds was thought to be aiding this measure.

The EUCB will probably try to reach June without issuing any new communication. In June the Eurozone area is expected to have a more open approach, new measures of protection and the Bank will value the purchase of assets.

Oil prices continued to struggle to capitalise on weekly increases and appear to have entered a modulation rate.

Accurate fuel data from the United States and China has raised hopes of an increased demand for energy earlier than had previously been expected.

Wholesale prices in the United States registered the largest increase since May of last year while unemployment levels dropped to their lowest level since the start of the pandemic in March last year.

Simultaneously, the Chinese economy expanded by 18.3% on an annual basis during the first three months of this year.

OPEC and its allies have increased demand prospects for this year against a background of stimulated economies and a more effective vaccination programme in various regions.

These positive situations have also caused a decrease in refined oil inventories over last week.

The price of gold was a narrow strip for various enterprises. Increases in US bond incomes have strengthened the $US and limited the increase of gold prices.

Expectations of ultra-low interest rates and inflation concerns should help for a decrease in price losses.

This is a resume’ of weekly financial news collated by BNF Bank.