US inflation data explodes!
U.S. inflation data in September exceeded expectations, and the global financial market responded sharply
On the evening of October 13, the globally evident US CPI data was released. The US September CPI year-on-year and core CPI year-on-year both were higher than expected, and the core CPI returned to a 40-year high year-on-year. The market's expectations for Federal again significantly at the November meeting in November continued to strengthen.
Data released by the U.S. Bureau of Labor Statistics showed that the U.S. CPI rose 8.2% year-on-year in September, higher than the market expectations of 8.1%, and the previous value of 8.3%. CPI rose 0.4% month-on-month, higher than the market expectations of 0.2% and the previous value of 0.1%. After excluding the volatile food and energy prices, the core CPI in September rose 6.6% year-on-year, higher than the market expectations of 6.5% and 6.3% of the previous value; the core CPI rose 0.6% month-on-month, higher than the market expectations of 0.4%, and remained flat at the previous value.
After the release of the expected inflation data, the global financial market responded violently. In terms of stock indexes, US stocks opened low and closed high, closing sharply, with the three major indexes rising by more than 2%; in terms of exchange rate , US dollar index surged and fell; in terms of commodity, international crude oil and precious metals first fell and then rose.
中文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文文The low unemployment rate has led to the continued rise in salary income, and to a certain extent it has become the main driving force for inflation to remain high. Based on this, it is expected that the Federal Reserve's monetary policy will remain severely tight, and the pace of reducing the balance sheet will also accelerate after the interest rate hike.
Founder Medium Futures Research Institute Global Macroeconomic Researcher Chen Zhen also said that although the US inflation data in September improved slightly, it was far from meeting expectations, which is far from the Fed's long-term target of 2%. On this basis, the market is worried that the Federal Reserve will adopt a more hawkish monetary policy from November to December, with the path to hikes of interest rates being "75BP in November, 50BP in December" more likely, and the balance sheet reduction will increase.
In the view of Wang Yang, assistant director of Shenwan Futures Research Institute, the US CPI fell slightly to 8.2% year-on-year in September, with core CPI rising instead of falling, and service inflation such as rental costs revealed stickiness. Coupled with the employment data that maintains resilience in weekly performance, concerns about wage-inflation spiral continue, further strengthening the Fed's expectations of maintaining a hawkish stance to curb demand. It may continue to raise interest rates by 75BP in November, and expectations of recession in Europe and the United States will remain high.
Judging from the impact on the commodity market, Jingchuan believes that the tightening environment will further promote the rise of US dollar assets, and the continued return of US dollar is inevitable. As the impetus of the US dollar as global payments and settlements and the economic outlook is bleak, it is inevitable that the prices of commodities, , especially industrial products, will remain weak.
Wang Yang also believes that the US dollar may continue to rise in the future, and commodities with high industrial correlation will be under overall pressure. It is recommended that relevant companies increase their hedging positions through the futures market.
"Although international oil prices and food prices fell in September, they were still at a relatively high level compared with the same period last year. Excluding energy and food, rents, which accounted for nearly 40% of the US CPI, continued to rise, while labor shortage problems remained serious. The strike crisis continued, forcing users to continuously increase wage levels, and the spiral upward trend of wages and prices did not break. In early October, with OPEC+'s announcement of production cuts and winter approaching, energy prices may also rebound. It is expected that the year-on-year growth rate of US CPI in October will remain high driven by energy. Under the Federal Reserve's strategy of "anti-inflation first and then save the economy", the Federal Reserve will still maintain a hawkish policy, and commodities still have a downward trend under pressure." Chen Zhen said.
International oil prices rebounded deeply
During the National Day holiday, due to the meeting of OPEC+, the foreign crude oil market has achieved five consecutive increases in output due to the decision of OPEC+ to reduce production by 2 million barrels per day from November to December, but as the positive news has been digested, foreign crude oil market has fallen sharply after the holiday. The crude oil series such as internal trading crude oil and fuel oil also recorded four consecutive negative results after the holiday.
On Thursday, international oil prices fell first and then rose, showing a deep V rebound trend. As of the closing of the day, the November contract of WTI crude oil futures rose $1.84 per barrel, closing at $89.11 per barrel, an increase of 2.11%; the December contract of Brent crude oil futures rose $2.12 per barrel, closing at $94.57 per barrel, an increase of 2.29%.
U.S. Energy Information Administration (EIA) data released on Thursday showed that as of the week ended October 7, U.S. commercial crude oil inventories increased by 9.88 million barrels to 439 million barrels, an expected increase of 1.75 million barrels; U.S. Strategic Petroleum Reserve (SPR) inventories fell by 7.69 million barrels to 408.7 million barrels, the lowest since the week of June 15, 1984.
"Overall, the United States has taken many measures to try to lower oil prices recently, including repeatedly calling OPEC+, expressing the idea of continuing to release strategic oil reserves, etc. At the same time, macro pressure remains unabated, US inflation is high, and the market expects the Federal Reserve to raise interest rates by 75 basis points and 50 basis points respectively in November and December, which has aggravated doubts about the soft landing of the US economy. In addition, in its latest world economic outlook report, IMF continues to lower global economic growth expectations, and is expected to slow down to 2.7% next year, 0.2 percentage points lower than the forecast in July." Zheng Mengqi, an energy and chemical researcher at Haizheng Futures, told Futures Daily reporters that due to the above factors, the price of crude oil has been falling in recent days, thus driving the decline in fuel oil and low-sulfur fuel oil prices.
In terms of foreign crude oil, WTI crude oil fell from US$93/barrel on October 7 to the current US$87/barrel; Brent crude oil fell from US$98/barrel on October 7 to the current US$92/barrel.
In the view of Du Bingqin, an energy and chemical analyst at Everbright Futures , the continuous decline in foreign crude oil this week reflects the market's concerns about the risk of economic recession. The three major global institutions reported monthly reports of EIA, IEA and OPEC lowered the growth rate of global oil demand this year to 2.12 million barrels per day, 1.9 million barrels per day and 2.64 million barrels per day respectively. At the same time, the International Monetary Fund (IMF) has also lowered its forecast for global economic growth this year and next year respectively. In addition, this week's API weekly data showed that US crude oil and gasoline inventories have accumulated significantly, resulting in further pressure on international oil prices.
Looking ahead to the fourth quarter, Du Bingqin believes that as the overseas economy slows down and the European and American central banks maintain monetary tightening policies, the macro pressure faced by oil prices and the drag on demand may continue.
Zheng Mengqi said that from the perspective of crude oil supply, OPEC will have the right to speak global crude oil in the future. As oil prices fall to around US$80 per barrel, member countries' willingness to support crude oil by reducing production has increased significantly. It should also be noted that the Russian crude oil maritime ban came into effect on December 5, and the implementation of a price ceiling may trigger Russia to take countermeasures. In terms of demand, the recession caused by sharp interest rate hikes is expected to suppress crude oil prices. In its latest monthly report, the IEA significantly lowered its global oil demand growth forecast for 2022 and 2023, mainly due to the surge in oil prices and a global recession caused by OPEC+ production cuts. In addition, OPEC also lowered its oil demand outlook in its latest monthly report due to the slowdown in the economy. "In general, from the current supply and demand reality, the positive is supported by OPEC+ production cuts, the negative is macro pressure, the bulls are intertwined, and crude oil shows a wide oscillation trend. In the future, we need to continue to pay attention to the return of Iranian crude oil, the United States continues to release the downward risks of oil prices brought by SPR, and the upward risks brought by the escalation of geopolitical risks." Huang Liunan, senior researcher at
Guotai Junan Futures , told reporters that in the fourth quarter, the central bank is still conducting tightening and the market's expectations for medium- and long-term economic recession have not changed, the short-term rise in energy prices will be difficult to immediately induce the market's strengthening of tightening expectations. The trading perspective of the crude oil market in the next 1-2 months may continue to return from macro expectations to micro supply and demand.But it should be noted that under the influence of current pessimistic macro sentiment, the monthly rebound of crude oil is unlikely to happen overnight. After oil prices continued to rise sharply during the National Day holiday, the upward offense slowed down this week, and the pullback in the past three days has been reflected. But in the long run, this round of repair rebound has not ended, and the center of gravity of oil prices may partially rebound in the fourth quarter. Before the two foreign oil markets hit a new low in the medium and long term, the center of gravity will have the opportunity to rebound to US$100 per barrel first.
Fuel oil, as of the closing of Thursday afternoon, the main contract of high-sulfur fuel oil in the domestic market led the decline in the energy and chemical system, with a drop of 3.87%, closing at 2,706 yuan/ton; the decline of low-sulfur fuel oil was less than that of high-sulfur fuel oil, with a drop of 1.75% to 4,710 yuan/ton. The main contract of SC crude oil futures stabilized, closing down 0.46%.
Regarding the weakest trend of the main contract for high-sulfur fuel oil in oil yesterday, Huang Liunan believes that there are two reasons: one is related to the shrinking of the global shipping market and the contraction demand for ship fuel under the resonance of the tightening cycle of overseas markets; the other is that the month-on-month increase in Russia's foreign high-sulfur fuel oil exports continues to force the current Asia-Pacific high-sulfur fuel oil market to continue to be in an oversupply pattern, extending the weak cycle of high-sulfur fuel oil.
In Du Bingqin's view, high and low sulfur fuel oils have declined continuously in recent days, mainly due to the continuous weakening of international oil prices and the resonance of the increased supply pressure of fuel oil. Specifically from the fundamentals of fuel oil, the current continued sufficient supply has brought pressure to the Asian high-sulfur fuel oil market. Low-sulfur fuel oil is supported by the reduction of imported arbitrage ship cargo, which is slightly stronger in sulfur fuel oil. The recent increase in inventory of the three major ports in the world has brought certain pressure to the fuel oil market. At the same time, due to the sanctions and embargoes from Europe and the United States, Asia has become the main destination of Russian fuel. According to shipment data, Russia's fuel shipments to Asia continued to increase in August and September, and from the current perspective, this trend has not been changed yet.
"Fuel oil prices in the fourth quarter will still face potential pressure from the crude oil side. It is expected that Asia's high sulfur supply will remain sufficient for the time being, while low sulfur supply is expected to tighten marginally. With the end of the peak season for high sulfur demand in summer, the heating season and high gas prices in Europe, Japan and South Korea may bring marginal increase to low sulfur demand. The overall situation in the fourth quarter may be weak in high sulfur and relatively strong in low sulfur." Du Bingqin said.
Zheng Mengqi said that the current summer Middle East power generation peak season has come to an end, and the demand for high-sulfur fuel oil is gradually weakening. In addition, the Russian-Ukrainian conflict has not yet ended, and the arrival volume of Russian fuel oil exports to Asia remains high, and the fundamentals of high-sulfur fuel oil are weaker, and its price trend is also weaker than other energy varieties. Low-sulfur fuel oil is supported by high diesel cracking, and the diesel components are continuously diverted. In addition, the European natural gas price is high, the hydrogenation cost increases, and its output is suppressed, resulting in a strong trend of low-sulfur than high-sulfur. Next, the high and low sulfur price difference may continue to remain high, and the absolute price is greatly affected by the fluctuations in crude oil prices.
International Energy Agency: Higher oil prices will have a significant impact on the global economy
According to CCTV News , on the 13th local time, the International Energy Agency released the "Oil Market Report" for October. The report said that the continued deterioration of the economy and the rise in oil prices caused by the "OPEC+" production cut plan are slowing global oil demand. The International Energy Agency stressed that amid continued inflationary pressures and rising interest rates, rising oil prices will have a significant impact on the global economy, which is already on the brink of recession.
The International Energy Agency said that "OPEC+" large-scale cuts in oil supply have increased global energy security risks. Therefore, the International Energy Agency lowered its expectations for oil demand growth in 2022 and 2023. The International Energy Agency said that since 2022, the growth rate of oil demand has gradually declined, and the fourth quarter of this year is estimated to decrease by 340,000 barrels per day compared with the same period last year. The annual growth rate of oil demand in 2022 is only 1.9 million barrels per day. The International Energy Agency also lowered its forecast for oil demand growth in 2023 to 1.7 million barrels per day, 470,000 barrels lower than the previous estimate.
International Energy Agency expects that starting from November, "OPEC+" crude oil production will drop by 1 million barrels per day, mainly from Saudi and the UAE. In December, Europe began to impose oil embargo on Russia, and global crude oil production will further reduce.
Media analysis believes that the relevant statements of the International Energy Agency highlight the huge differences between it and OPEC , which also reflects the huge differences between the International Energy Agency and OPEC member states. This disagreement will seriously affect the stability of the international oil market.
International Energy Agency was established in 1974. It is an international organization established by major oil consumers in order to coordinate oil policies of various countries and reduce their dependence on imported oil after the Middle East oil crisis. Currently, the International Energy Agency has a total of 31 member states.
Russia's European oil pipeline leaked in the Polish section of Russia's European oil pipeline
According to CCTV News, after multiple leaks occurred in the "Northern Stream" natural gas pipeline, another important energy facility between Russia and Europe has leaked. On the 12th local time, the operator of the "Friendship" pipeline that Russia transports oil to Europe said that the company monitored a leak in a pipeline on the evening of the 11th, and the specific cause of the leakage is still unknown.
According to the announcement released by the operator, the location where the leak occurred in the "Friendship" oil pipeline is about 70 kilometers away from the central Polish city of Pvodsk. The images taken by the drone on the 12th showed that black oil stains flowing out of from underground pipeline spread to farmland near the leakage site, and fire trucks and emergency rescue teams could be seen on the scene. According to firefighters on the scene, they had drained about 400 cubic meters of oil and water from the oil spill site.
Local Polish residents: I happened to be outside at that time and smelled a strong smell. I don't know what happened, but I saw a light flashing.
Russian oil pipeline transport company said on the 13th that the leakage in the Polish section of the "Friendship" oil pipeline did not cause Russia's supply to Poland or Germany to decline. The operator of the Polish section of the
"Friendship" oil pipeline said on the 12th that professionals are analyzing the cause of the leakage and repairing the pipeline. After preliminary investigation, there is no sign that the leakage of the pipe section was caused by intentional damage. "Preliminary investigation and pipeline deformation show that there is currently no sign of third-party intervention."
State Secretary for Strategic Energy Infrastructure, Mateush Berger, said on the 12th that there is no reason to infer that the leakage was caused by intentional damage and may be "accidental damage." Polish Prime Minister Molawitski said on the same day that it is too early to judge whether the pipeline leakage was an accident or man-made damage.
This article is from Futures Daily
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