01, Reasons for the Decline in Oil Prices

On Monday, the international crude oil price was at its highest at $93.74 per barrel, but it plummeted on Tuesday, closing below $89, and on Wednesday, the price of crude oil fell further to $85.64. Over these three days, the price has dropped by more than 9%.

It's not just the WTI crude oil price that has fallen; the Brent crude oil price has also seen a decline. On Monday, it reached its highest point at $99.56, very close to $100, but it has now dropped to $92.47.

We can generally look for reasons for the fluctuation in crude oil prices from two perspectives: the first is the supply and demand side, and the second is the monetary side.

It is clear that there has not been a significant increase in supply during this period; on the contrary, since November, the production cut decision by OPEC+ has taken effect, and the current supply should have decreased.

However, the crude oil price has still experienced a substantial decline, which can only be explained by the possibility of the US dollar continuing to strengthen further.

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And the biggest news of this week, without a doubt, is that the United States will release the latest CPI inflation data on Thursday evening.

In the past three months, the US CPI has declined month by month, but core inflation has shown signs of picking up, and it is not ruled out that this time's CPI data could be a black swan event.

If the CPI data significantly exceeds expectations, then the speculation that the US will reduce the interest rate hike in December will be shattered, and the Federal Reserve will inevitably continue to raise interest rates significantly, which would further strengthen the US dollar index, and this could explain the continuous sharp decline in crude oil prices.

02, Stock MarketIn addition to the decline in commodity prices, exchange rates of various countries have also fallen.

Yesterday, the British pound fell, the Chinese yuan fell, and the euro once again broke through the 1.0 mark, and the impact also spread to the stock market.

Yesterday, stock markets in European countries all fell, but the decline in the UK, France, and Germany, and the three major stock markets was not significant, none exceeding 0.2%.

However, the decline in the US stock market was very large, with the Dow Jones Industrial Average falling by 1.95%, and the other two major indexes both fell by more than 2%, especially the Nasdaq index, which was the first to fall yesterday, down by 2.48%.

A while ago, when the US stock market rebounded, the Dow Jones Industrial Average rose the most, and the Nasdaq index rose the least, and now when it falls, the Nasdaq index's decline is the largest, which has also caused the divergence in the decline of the three major indexes this year to become larger and larger.

At present, the Dow Jones Industrial Average has fallen by 10.5% for the entire year, while the Nasdaq index has fallen by nearly 34%, and the decline has more than tripled.

In addition, the CPI data that the United States will announce may also produce an unexpected result.

This has to start with the CPI data announced by our country yesterday. The latest inflation data announced this time showed that the CPI rose by only 2.1% year-on-year, a significant decline from last month's 2.8%. And the PPI has turned negative, meaning that compared with the same period last year, there has been negative growth.

The most optimistic expectation for the US CPI will also increase by 8%, and it may even far exceed expectations.Comparing the inflation between China and the United States, we find that our country's inflation level is very low, which is very suitable for the development of enterprises.

After the release of the CPI data in the United States, it may allow more European companies to make up their minds. When relocating their businesses, the first choice is not the United States, but China.

Because although the energy prices in the United States are much lower than in Europe, once the business is relocated to the United States, it will inevitably be affected by the soaring inflation, facing a greater pressure of rising costs. At the same time, the continuous increase in financing interest rates will also make enterprises unbearable.

This will be a strong stimulant for the continuously improving Chinese economy.