East Airlines Finance: The US temporarily retains its 3A rating while crude oil prices continue to fall - Stock Index Futures Account Opening

by donghang0728 on 2011-08-04 16:01:01

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The US debt crisis that has been troubling the market has finally been temporarily relieved. The risk of a US debt default over the past two months has come to an end. The final role of the US bond as a safe haven has not changed. Moody's and Fitch subsequently confirmed that the US sovereign debt 3A rating remains unchanged, but still listed it on the negative watch list, maintaining the expectation of a downgrade of US bonds. However, the economic growth rate of the core countries in the eurozone is currently slowing down, and the debt crisis may spread to the third largest economy in the region, Italy. This sign worries the policy makers of the European Central Bank and makes the once stopped bond purchase become a focus of attention again.

Given that investors are concerned about the slowdown in US economic growth, and reports show that US crude oil inventories increased last week, international crude oil prices closed down at $91.93 on Wednesday, the lowest level in more than five weeks. On that day, the September-delivery light sweet crude oil futures price on the New York Mercantile Exchange (NYMEX) fell by $1.86, or 1.9%, marking the lowest closing price for the main contract since June 27, when New York crude oil futures prices closed at $90.61 per barrel. The September-delivery Brent crude oil futures price on the London ICE European Futures Exchange fell by $3.23 to close at $113.23 per barrel, marking the highest decline since June 23, when the International Energy Agency (IEA) announced that its member countries would release 60 million barrels of crude oil inventory. Calculated by the closing price, the difference between the Brent crude oil futures price and the New York light sweet crude oil futures price was $21.30 per barrel, retreating from the historical high of $22.67 per barrel set the previous day.

According to a report published today by the Energy Information Administration (EIA) under the U.S. Department of Energy, as of last week, U.S. crude oil inventories increased by 1 million barrels, analysts expected an increase of around 2 million barrels; gasoline inventories increased by 1.7 million barrels, analysts expected an increase of 350,000 barrels; distillate inventories increased by 400,000 barrels, analysts expected an increase of 1.8 million barrels.

In general: Although the credit rating of the United States has not declined temporarily, the prospects it faces remain severe. Given the current economic downturn and the turmoil in the debt market, the European Central Bank may suspend interest rate hikes. The ECB may have already begun preparing to repurchase bonds. Considering the current quarterly economic malaise and the recent trend of crude oil, there is a tendency for crude oil prices to break through the $90 per barrel mark.

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