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The focus on the attack on oil plants in Saudi Arabia, which has already led to a serious reduction in oil production in the kingdom, is in the spotlight. We are talking about at least a twofold reduction in production volumes. Moreover, according to various reports, it may take weeks, or even months, to restore production volumes. Naturally, as soon as trade opened, the price of black gold instantly rushed to a height of more than 10%. In this regard, do not forget about the real relationship between the cost of oil and the dollar. If oil rises in price, then the dollar becomes cheaper, and vice versa. So the dollar will not pass without a trace.
However, do not think that a weakening dollar will be panic-stricken. Rather, it will be symbolic. This is indicated by the market reaction to Friday's retail sales data in the United States, which should have slowed from 3.4% to 3.2%. However, the previous results were revised upwards, to 3.6%, and sales growth accelerated to 4.1%. Nevertheless, the market seemed to have stood still. This indicates that investors are much more interested in the outcome of the meeting of the Federal Open Market Committee, during which it is expected that the refinancing rate may be reduced from 2.25% to 2.00%. This is what worries investors, not the decline in oil production in Saudi Arabia. After all, the United States has already said that in the event of an oil shortage, it will unfreeze its reserves. In other words, the jump in oil prices may be temporary, and will not greatly affect the situation on the market.
Retail Sales Growth Rate (US):
From a technical point of view, there is a clear stagnation in the EUR/USD pair, after a sharp increase in volatility caused by the results of the European Central Bank meeting. Quotes are relatively stable, even against the backdrop of significant macroeconomic data. Market participants are clearly waiting. A strengthened information background may lead to a temporary increase in volatility. Perhaps the movement of the pair in the range of 1.1075 - 1.1100. Subsequently, the existing uncertainty regarding the outcome of the meeting of the Federal Open Market Committee may lead to a decrease in EUR/USD in the range of 1.1025 - 1.1050.
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