OPEC To Cut Production?
Good day… And a Happy Friday to one and all! It’s a Jobs Jamboree Friday to boot! I’m writing from home this morning, as after “getting” to sit in the dentist’s chair another 2/12 hours yesterday, I get to go back first thing this morning… It’s my Lucky Day! NOT! So… I think today’s Pfennig will be short and sweet… I think!
OK… As we begin this Friday morning, we remain in a very tight trading range… So tight, Tupperware would be proud! The bias is for the dollar at the moment, as traders are betting that the forecast for only 125K jobs created will be too low, and it will be sufficiently higher as to catch the Fed’s attention, and get them to raise rates again….
What a bunch of dolts! The Jobs Jamboree doesn’t have enough jobs in it to make the Fed want to do that! This is crazy…. Crazy I tell you! I’ve said all week that I believe the Jobs report will disappoint… That’s my story and I’m sticking to it! Either way though, the currencies will end the week being driven by the Jobs Jamboree bus.
My laptop is doing all kinds of strange things right now… I doubt that I’ll have the patience to get through this! UGH!
Well… Yesterday we saw Gold trying to stage a comeback that was tied to oil… There were two rumors going around yesterday that really got the price of oil back over $60… The first one I heard through traders was that oil tankers were reporting a cut in Saudi oil production… Then the news wires had a story that OPEC might meet to discuss cutting oil production. Now… That’s one way to get the price back up, eh?
I’ve not seen anything since that report… So it could all be hogwash by now… But the one thing it does indicate to me is that should the price of oil turn around, it would certainly light a fire under gold! I just read a report that said an analyst didn’t expect any production cuts at this moment… That’s smart of him… If OPEC decides to cut production this weekend, the analyst can say… “I said at this moment”
The ECB did raise rates, but only 25 BPS yesterday. In the press conference, ECB President Trichet sounded very hawkish, although he did leave out the “vigilant” word… I would say to keep a light on for another ECB rate hike in December… This brings the overnight repo rate in the Eurozone to 3.25%… The rate differential with the U.S. is narrowing ever so much, and that should indicate to the markets that the risk premium that the U.S. was paying is disappearing. And that… Should be very euro friendly!
As I told you yesterday, the Bank of England did not raise rates, and left them unchanged… However, nothing has changed there… As I told someone the other day in an email, if the Bank of England passes this month, I fully expect them to raise rates in November. So… Sterling should remain well bid…
I see this morning that after 4 months of disappearing jobs in Canada that they posted a gain in jobs of 16,200 in September. I know that doesn’t sound like a lot… But it is bang on forecasts… And puts them back on the positive job creation chart for 2006!
I’m going to finish this up, because now my widow that I’m writing in keeps going away and I have to go find it! UGH!
I would look for a upward bump in the Singapore dollar soon as the Singapore Central Bank has given its blessing to maintaining its “stronger currency bias”… Memo to the Singapore Central Bank… Raising interest rates would go a long way toward maintain that stronger currency bias!
I’m heading to the Bid Finish now… This thing is driving me crazy… I’m crazy for loving the Pfennig…. Ahhh… A little Patsy Cline to calm me down… Now that’s the ticket!
Currencies today: A$.7460, kiwi .6650, C$ .8920, euro 1.2680, sterling 1.8765, Swiss .7980, ISK 68.10, rand 7.7750, krone 6.6450, SEK 7.3125, forint 215.90, zloty 3.10, koruna 22.2450, yen 118, baht 37.45, sing 1.5835, HKD 7.7840, INR 45.57, China 7.9040, pesos 11.02, Silver 11.09, and Gold… $574.50
That’s it for today… I received word yesterday that an upcoming issue of Consumer Reports is going to have a quote from me regarding inflation… This was from an interview I did with a very nice reporter… So look for that at your local news stand! Big weekend for my Cardinals, Tigers and Rams… Cardinals first… My little buddy and I will be there! Have a great Friday… And weekend… Now, where are my pain pills, it’s time to go to the dentist!
October 6, 2006