After initial dip over Doha disappointment yesterday, crude oil staged a rebound on news of Kuwait oil workers' open-ened strike for protesting a proposal to cut wages and benefits of all public sector employees. The country's crude production dropped by more than half on Sunday. WTI crude oil beached 40 after hitting as low as 37.61. Stocks markets also reversed initial weakness and DJIA closed up 106.7 pts, or 0.60%, to close above 18000 handle at 18004.16. S&P 500 rose 13.61 pts, or 0.65%, to close at 2094.34. Nikkei follows and is now trading up 560 pts, or 3.4% at the time of writing. Currency markets followed with yen trading broadly lower for the weak. Commodity currencies, to a lesser extent Canadian dollar, reversed initial loss this week and are trading higher.
The minutes of April 5 RBA meeting noted that the better than expected growth in 2015 was "broadly consistent" with improvements in the job market. And recent data suggesetd that the economy "had continued to grow at a moderate pace" this year. Nonetheless, "continued low inflation would provide scope to ease monetary policy further, should that be appropriate to lend support to demand." Also, RBA reiterated that "an appreciating exchange rate could complicate progress in activity rebalancing towards the non-mining sectors of the economy."
In US, Boston Fed president Eric Rosengren said that US is not far from the 4.7% "full employment" rate. And his concern was "an interest rate path at the pace embedded in the futures markets could risk an unemployment rate that falls well below the natural rate of unemployment." And, he didn't see that "risks are so elevated, nor the outlook so pessimistic, as to justify the exceptionally shallow interest rate path currently reflected in financial futures markets,"
On the data front, Germany ZEW economic sentiment is the main focus in European session while current account will also be released. US will release housing starts and building permits.