Soybeans started the week on a volatile note as they surged to a new high for the move early in the session before some profit taking set in and pulled the market lower. Late in the day the market found more buying and closed in the green.
OPEC’s decision to refrain from action had an immediate effect on crude oil prices. Prices sunk as it became clear Saudi Arabia is more concerned with losing markets share than the pressure low prices are putting on its cartel partners.
Are falling crude oil prices a good or bad thing? The Saudi oil price war is raising those questions as they cut the selling price to Asia and say they think oil will stabilize at $60 a barrel which may become a self-fulfilling prophecy.
The collapse in the price of oil is unmaking deflationary pressures and could cause a wave of defaults as the global economy and cause an environment where people are going to be less willing to lend money not just in the energy sector but across the economic spectrum. Not only are there growing supply side worries it is coupled with signs of weakening demand.
Today oil will take its cue from the dollar. The dollar will move on the European Central Bank Statement that is due. With Japan going quantitative easing crazy, can the European central bank keep pace?
President Barack Obama addressed an audience of several hundred people at Northwestern University in Evanston, Ill., on Thursday, where he struck a positive tone as he applauded America’s economic progress and expressed his confidence in its position as the world’s leading nation.