Crude oil and some agricultural commodities continue to shoot to new highs due to the war in Ukraine.
Eight days into the Russian invasion of Ukraine, Kiev continues to hold out but Russian forces have intensified their use of air strikes and artillery everywhere, and taken the strategic town of Kherson near Crimea. The town of Mariupol is believed to still be in Ukrainian hands but has been hit by heavy shelling, with claims of hundreds of dead civilians. Ukraine and the USA say that almost 6,000 Russian soldiers have been killed, with Russia admitting to 500 dead.More companies are refusing to operate or sell within Russia. Thousands of Russian demonstrators against the war have been arrested. The Russian stock market remains closed, but the Russian ruble is regaining some of its losses from recent days.WTI Crude Oil continues to rise strongly due to the war in Ukraine, and is close to $115 per barrel and a 13-year high price.Wheat futures have risen to a 14-year high, with wheat being a key product of Ukraine and therefore suffering export disruption. Corn futures are trading at a 9-year high.The Chair of the Federal Reserve Jerome Powell testified before Congress last night and signaled that the Fed still plans to hike rates at its forthcoming meeting by 0.25%, despite fears that the economic blowback from the Ukraine war could derail the planned hike. The US dollar rose as a result and global stock markets are a little stronger.In the Forex market, the US dollar is broadly strong, while the euro remains the weakest major currency, with the EUR/USD trading yesterday at an 18-month low below $1.1100. The Swedish krona is even weaker, partly due to fears of potential clashes with Russia, which yesterday breached Swedish airspace.The Bank of Canada hiked its interest rate as expected yesterday by 0.25% to 0.50%. The Canadian dollar strengthened as a result and has advanced even against the US dollar, making it the strongest major currency yesterday.Today will bring a release of US ISM Services PMI data.Daily new coronavirus cases globally seem to have peaked six weeks ago, showing that the omicron variant wave is in strong decline almost everywhere.It is estimated that 63.1% of the world’s population has received at least one dose of a coronavirus vaccination.Total confirmed new coronavirus cases worldwide stand at over 440.6 million with an average case fatality rate of 1.36%.The rate of new coronavirus infections appears to now be increasing only in Bhutan, Brunei, China, Iceland, South Korea, Malaysia, New Zealand, Singapore, Thailand, and Vietnam.
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