Wednesday, 18 Nov 2009

MPC Minutes and U.S. Oil Inventories Drive Trading

Trading today largely revolved around the release of the Bank of England's Monetary Policy Committee (MPC) meeting minutes. With the minutes revealing a split vote among the MPC at the November 4-5 meeting, GBP fell more then half a cent against the U.S. Dollar, landing at $1.6764. The EUR was able to subsequently pick up gains against the weakening pound to reach 89.09 in trading after the release of the reports. Risk appetite seemed to be returning to investors as the dollar fell against all of its major counterparts. This is largely due to expectations that the U.S. stock market will see profits today. With the stock market seen as an indicator of dollar strength, gains on Wall Street generally coincide with a weak greenback. Traders might want to bet on the EUR making gains in trading today while both the pound and dollar are weak, assuming Wall Street performs as expected.

Ahead of the 15:30 GMT release of U.S. Crude Oil Inventories, the price of the commodity seems to be steadily rising. There is speculation that oil stockpiles have not risen significantly in large part due to a recent hurricane in the Gulf of Mexico. Traders can expect Crude Oil prices to continue to rise assuming the numbers do indeed come in as forecasted at below 0.8 million.