Inflation is wary due to high crude oil prices, stock market is weak, and foreign exchange is under strong dollar pressure

In the market at the beginning of the week, the movement of high crude oil prices is conspicuous. The OPEC Plus meeting showed a policy of maintaining the conventional production plan, which further accelerated the rise in crude oil prices. NY crude oil futures temporarily rose to the $ 78 level.

The supply and demand was tightened due to economic recovery from the new coronavirus infection, bottlenecks in production and supply, etc., but it was warned that the supply of crude oil would become even tighter because the increase in production was not announced. So far, high oil prices have been welcomed as a sign of economic recovery, but are now being treated as bad guys as an indication of inflation caution.

Monetary policymakers in each country have taken the view that rising inflation is temporary, but it seems that there is a sense of caution that inflation will rise longer than expected. The market, which has been accustomed to the state of ultra-easy monetary policy, is becoming increasingly uneasy.

In the US stock market yesterday, the Nasdaq Index closed at 14255.48, down 2.14%, and was pushed to sell. The Dow Jones Industrial Average also closed at 34002.92, down $ 323.54, barely maintaining the high level on a closing price basis. In today’s Tokyo stock market, the Nikkei average temporarily fell by more than 900 yen, and sales strengthened. Although technical factors such as algo transactions have been pointed out, it can be said that market sentiment is deteriorating.

Tonight, pay attention to where the USD is heading. Also, yesterday I bought CAD in anticipation of high crude oil prices, but the movement is not good. If the movement continues to be sluggish, I am thinking of cutting the position.

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