By FX Empire.com
Crude oil prices rebounded to the upside on Tuesday, as fears eased over the outlook of the U.S. budget after rating agencies Standard & poor’s and Moody’s Investors Service confirmed they won’t downgrade the credit rating of U.S. debt, which overshadowed the slower than expect growth in U.S. GDP, where the U.S. economy expanded in the third quarter by 2.0% down from the prior estimate of 2.5%.
Traders will continue to monitor the developments from Europe regarding the debt crisis, where rising yields in Europe suggest investors are concerned amid the uncertainty that is surrounding the outlook of the EU debt crisis. Traders will be also eyeing the latest developments regarding the budget deficit deal and how U.S. lawmakers will tackle the budget deficit. Moreover, traders will be eyeing the income report, which is expected to show that personal income and spending continued to improve in October, while the University of Michigan confidence index is expected to show slight improvement in November.
Traders will be also eyeing the EIA report for crude oil stockpiles last week, where the EIA report is expected to show that crude oil inventories increased by 1.5 million barrels.
Our overall outlook for crude oil prices is still bearish, where expectations of weak growth levels in Europe, in addition to the uncertainty over the outlook for global growth are likely to keep crude oil prices under pressure over the coming period, however, we could witness high levels of volatility on Wednesday ahead of the Thanks Giving holiday on Thursday.
Wednesday November 23:
At 13:30 GMT the United States will join the session with the durable goods figures for October, where durable goods orders could have fallen 1.0% from the previous drop of 0.8%, while durable goods excluding transportation index is expected unchanged, noting that the previous expansion was 1.7%.
The United States will also release the income report at 13:30 GMT, with expectations that the personal income index could have improved 0.3% from 0.1%, while the personal spending index could have expanded by 0.3% from 0.6%. Furthermore, the annual PCE Deflator could have expanded by 2.7% from 2.9%, while the monthly PCE core could have improved 0.1% from the previous zero expansion, in the time the annual PCE core is expected higher at 1.7% from 1.6%.
In addition, the United States will provide markets with the initial jobless claims figure for the 19th of November, where the number of claims could have eased to 385 thousands from 388 thousand.
At 15:30 GMT, the EIA report for crude oil inventories will be released for the week ending November 18, where the prior estimates showed crude oil inventories decreased by 1.1 million barrels, and expectations show crude oil stockpiles increased by 1.5 million barrels.
At 14:55 GMT the United States will end the session with University of Michigan confidence for November in a final reading, where the confidence could have improved slightly to 64.5 from 64.2.
Originally posted here
