On days like this, when markets go down, commodities, currencies everything seems to go down, you wonder which way it will head next, and what is really influencing the movements.
Lakshman Achutan of Cycles Research Institute was opining that the U.S. could be in a mild recession by summer-time. With the way the oil price has stayed up, it is little wonder that everything seems to be slowing down. The 0.3 percent drop in European GDP in an indication. The high oil price is also a component of the revised forecast from China that their growth may be only 7.5 percent this year.
The high oil price is having a detrimental effect on growth everywhere, and unless some correction is made now, the impact will be registered in due course.
Brent Ice at $122.50 or Nymex WTI at $104.60 are very high, as they include about 15 percent built in on the Persian Gulf factor.
Once the leaders can reassure the world that a negotiated peace and continued diplomatic efforts are the preferred option, hopefully the markets can start to correct themselves to the benefit of a continued worldwide Recovery. For that I pray.