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The Fed's current policy has lost effectiveness and at the end of what will be the longest US economic cycle in history, the FOMC is expected to announce the beginning of an easing cycle. US equity futures are hovering from a stone's throw from fresh record high as the Fed concludes their two-day policy meeting. Bond yields are adjusting to expectations of fresh stimulus from all the major central banks. Germany sold 2046 bunds with a record low yield, following the Belgian auction who saw record lows with their auction on Monday. The low interest rate environment is likely to remain in place as the Fed begins an easing cycle and the ECB appears set to resume cutting interest rates. The dollar trades slightly softer ahead of the Fed decision.

Technology shares will come to focus today after the Nikkei reported that Apple is asking suppliers to consider moving 15-30% of its output from China to Southeast Asia. China is a critical hub for Apple's business and some manufacturers have already pushed back. If we see US-China trade talks fall off a cliff, Apple suppliers, such as Hon Hai Precision Industry have contingency plans that could deliver iPhone production outside of China. In the event of an extended trade war, the main victim will be the consumer who will see higher costs.

Fed

The Federal Reserve will conclude its two-day policy meeting with economists expecting a confirmation of an easing bias in the second half of the year. Fed fund futures see a 22.9% chance that rates will be cut at today's meeting, while the July 31st meeting have an 81.5% expectation for a rate cut. With inflation anchored below their target and the Fed's first regional survey, Empire Manufacturing saw the worst decline on record, the FOMC should feel ready to embrace going full dove. Broad weakness has started to hit the US economy from trade uncertainty and that should still persist even if Trump and Xi deliver a de-escalation in tariff threats at the G20 summit at the end of the month. The Fed could try to hold out one more month before committing to rate cuts and note that the policy stance is appropriate right now. The dollar could rally if the Fed reiterates their patient stance, but the more likely scenario is for Powell to begin to adopt a dovish stance. How dovish of statement and how many rate cuts are shown in the dot plots will likely determine how far the dollar could fall.

Trump

President Trump officially launched his re-election bid on Tuesday at a rally in Orlando, Florida. Trump stuck to his favorite talking points which ranged from the strength of the economy, to Hillary Clinton, immigration, and Robert Mueller. Despite an overall strong economy that is at the tail of end or record long economic cycle, Trump is behind in most polls including one from Fox News over the weekend. With a potential 10-point deficit to Joe Biden and 9-point gap with Bernie Sanders, Trump appears set on keeping to the 2016 script that worked well for him during the last election.

Lira

The US is weighing fresh sanctions on Turkey over the purchase of S-400 missile-defense systems from Russia. Severing Turkish companies from the US financial system would add further strain to an already weak Turkish economy. Trump and Erdogan will likely speak at the G20 summit, and the US administration will likely decide in early July if they should move forward with the sanctions. The lira fell 0.5% to the dollar after falling over 1.5%.

ECB Vice President Luis de Guindos said today that the centra bank foresees "lingering softness" n the near term, due to geopolitical factors and trade tensions. Both are weighing on exports and manufacturing in Eurozone economy.

He emphasized that "if we see that inflation expectations start to de-anchor, we will act." ECB has a "wide range of instruments available", including forward guidance, TLTRO and QE is one of them. And, "a combination of actions" could be used to restore inflation.

De Guindos' comments echoed President Mario Draghi's yesterday. Draghi said, "in the absence of improvement, such that the sustained return of inflation to our aim is threatened, additional stimulus will be required."

Wednesday June 19: Five things the markets are talking about

The dollar is largely unchanged overnight against G10 currencies as investors await central bank meetings, including the conclusion of the Fed’s two-day meeting later today.

Markets are entering uncharted waters, sovereign yields trade atop of year lows, equities looking to breach new highs now that cracks are appearing in 2019 tighter monetary policy rhetoric amongst G10 central bank members.

Yesterday, ECB president Draghi signaled that the central bank could embark on new stimulus measures in light of risks over the eurozone’s economy. This potential shift in policy by the ECB will certainly make interest-rate increases by other central banks more difficult.

Today, the focus is on the Fed (02:00 pm ET), investors are widely expecting the Fed to cut rates at some point in the coming months, but not today. Currently the market is pricing in a pace of easing that would only be justified by a recession – the potential of two to three cuts by Q1, 2020. Are things that bad? Fed Powell’s press conference should be very interesting (02:30 pm ET).

On tap: Central Banks dominate proceedings this week – the Fed, Bank of Japan and Bank of England all set monetary policy, along with central banks in Norway, Brazil, Taiwan and Indonesia.

1. Stocks given the green light

In Japan, the Nikkei has rallied hard overnight to end atop of its six-week highs on news that the U.S and China will revive talks on trade, while expectations that the Fed will cut rates later this year is giving added support. The Nikkei share average jumped +1.7%, while the broader Topix also climbed +1.7%.

Note: President Trump said he would meet with Chinese President Xi Jinping at the G20 summit later this month and said talks between the two countries would restart after a recent lull.

Down-under, Aussie stocks ended at their 11-year highs overnight, as investors took comfort from the U.S and China rekindling trade talks. Australian resource stocks gained the most. The S&P/ASX 200 index climbed +1.2%. It had risen +0.6% on Tuesday when the Reserve Bank of Australia (RBA) had pointed to further policy easing in the future. In S. Korea, the Kospi closed +1.2% higher.

There were no surprises in Hong Kong or China as stocks closed higher as Washington and Beijing looked to rekindle trade talks. In China, the blue-chip CSI300 index rose +1.3%, while the Shanghai Composite Index gained +1.0%. In Hong Kong, stocks posted their best session in seven-months. At the close, the Hang Seng index rose +2.6%, while the China Enterprises Index gained +2.5%.

In Europe, regional bourses trade lower across the board consolidating after sharp gains Tuesday, following a strong session in Asia and flat futures in the U.S.

U.S stocks are set to open ‘little changed’ (-0.1%).

Indices: Stoxx600 -0.2% at 383.9, FTSE -0.4% at 7416, DAX -0.1% at 12320, CAC-40 -0.2% at 5500, IBEX-35 -0.4% at , FTSE MIB 0% at 21216, SMI -0.6% at 9946, S&P 500 Futures -0.10%

2. Oil rallies on Sino-U.S trade hopes, gold unchanged

Oil prices have extended their gains overnight, supported by rekindled hopes for a Sino-U.S trade deal and potential economic stimulus from central banks.

Also providing support is the uptick in tensions in the Middle East after tanker attacks there last week. Washington blames Iran, but Tehran denies any involvement. President Trump has indicated that he is “prepared to take military action” to stop Iran having a nuclear bomb.

Brent crude futures are up +20c, or +0.3%, at +$62.34 a barrel. They rose +2% yesterday, while U.S West Texas Intermediate crude also gained +20c, or+ 0.4%, to +$54.10 a barrel. The benchmark surged +3.8% on Tuesday.

The market is also waiting for the OPEC+ meeting where members will decide whether to extend a supply reduction pact that ends this month. This morning, OPEC has agreed to move its next meeting to July 1, followed by a meeting with non-OPEC allies on July 2. Joint technical committee will meet June 30.

Providing further support was yesterday API data showing that U.S crude stocks fell by -812K barrels last week to +482M. Expect dealers to take directional guidance from the U.S government’s EIA report this morning (10:30 am ET).

Ahead of the U.S open, gold trades steady as investors await the Fed’s monetary policy decision later today. Spot gold is steady at +$1,345.28 an ounce, while U.S gold futures are down -0.1% at +$1,349.40 an ounce.

3. Yields new record lows

Fixed income markets are in pause mode following yesterday’s plunge in European bond yields as Draghi opened the ECB forum in Sintra on a “dovish” note.

Markets saw new all-time yield lows for 10-year bonds in Germany, Denmark, Netherlands, Austria, Finland, Sweden, France, Belgium, Slovakia, Ireland, Slovenia, Latvia, Spain, Portugal, Cyprus and Croatia.

Currently, bond yields are a tad higher after yesterday’s plunge. ECB policy makers seem to be divided after Draghi’s ‘dovish’ speech. Ten-year bond yields across the bloc are +1-2 bps higher in early trade. Germany’s 10-year Bund yields are a touch higher at -0.31%, having hit a record low at -0.33% yesterday when it fell almost -8 bps – its biggest one-day fall in three-years.

Elsewhere, the yield on U.S 10-year notes rose +2 bps to +2.08%. In the U.K, the 10-year Gilt yield has jumped +4 bps to +0.846%, while in Japan, 10-year JGB yield has decreased -1 bps to -0.137%.

4. Dollar contained for now

EUR/USD (€1.1202) has remained well contained since ECB’s President Draghi said yesterday that more bond-buying or interest rate cuts were options to tackle low inflation. The uptick in ‘dovish’ rhetoric will appease EUR bears. However, they have to wait for the Fed for clarity on potential U.S rate cuts to gain further support. The EUR/USD hit a two-week low of €1.1181 Tuesday.

Data showing U.K annual CPI inflation slipping to +2.0% in May from +2.1% in April has failed, thus far, to impact the pound, with GBP/USD last up +0.1% at £1.2569. Brexit uncertainty is unlikely to push the BoE into flagging possible rate cuts, as the ECB and Fed have done.

Elsewhere, TRY ($5.8629) is under pressure outright on reports that the Trump administration is weighing new sanctions on the country over its purchases of the Russian S-400 missile-defense system.

5. Boris Johnson strong lead

Boris Johnson has taken a step closer to becoming U.K’s next PM, winning +40% of votes in the second round of a contest on a firm promise to leave the E.U by Oct. 31.

The candidates contending to be the U.K’s next PM has been whittled down to five and will be cut to the final two by the end of the week.

UK Conservatives announced results of second leadership ballots (total 313 votes; 33+ needed to move on). Boris Johnson 126 votes; Michael Gove 41 votes; Jeremy Hunt 46 votes; Rory Stewart 37 Votes; Sajid Javid 33 Votes with Dominic Raab being eliminated (30 Votes)

Boris Johnson has extended his lead to quite a significant margin and used last nights debate to provide a few more details on how he intends to sort out Brexit.

Note: Johnson goes through to a third ballot between 09:00 ET and 11:00am ET today

On Tuesday, the EUR/USD currency pair tested the support level formed by the monthly PP at 1.1181. During today's morning, the pair was testing the Fibonacci 38.20% retracement at 1.1200.

Note, that the exchange rate is pressured by the 55– and 100-hour moving averages, currently located at 1.1211 and 1.1233 respectively. Thus, it is unlikely that some upside potential could prevail in the market.

If the given support level holds, it is likely, that the rate could trade sideways in the nearest future.

If the given support does not hold, the pair could target the weekly S1 located at the 1.1162.

Yesterday, the GBP/USD exchange rate reversed north from the lower boundary of the medium-term descending channel at 1.2528.

From a theoretical point of view, it is expected, that some upside potential could prevail in the market, as the rate targets the upper channel line. However, note, that the currency pair has to surpass the 100-hour SMA at 1.2597.

If the given resistance holds, a reversal south could occur within the following trading hours. In this case, the pair could be supported by the 55-hour SMA at 1.2555.

If the given resistance does not hold, the rate could target the resistance level formed by the 200-hour SMA and the weekly PP at 1.2644.

Yesterday, the USD/JPY currency pair re-tested the lower boundary of the medium-term ascending channel at 108.20.

During today's morning, the pair was testing the resistance cluster formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP and the Fibo 38.20% in the 108.44/108.51 range.

If the given resistance does not hold, the exchange rate could extend gains and target the psychological level at 108.70.

Otherwise, it is expected, that the rate could re-test the given channel. It is unlikely, that a breakout south could occur due to the support of the weekly S1 at 108.23.

During the previous trading session, the XAU/USD exchange rate tried to surpass the psychological level at 1,355.00.

Given, that gold is supported by the 55– and 100-hour SMAs, currently located at 1,342.96, it is likely, that bulls could prevail in the market. A possible upside target is the range between the 1,350.00 and 1,355.00 levels.

It is unlikely, that some downside potential could prevail in the market, and the price for gold could drop lower than the 1,333.67/1,333.34 range due to the support of the 200-hour SMA and the monthly R2.

Notes/Observations

• Market took Draghi Sintra speech as a U-turn compared to the June ECB meeting with the question being how much of stimulus to come...
• OPEC+ choses date to discuss output in Vienna on July 1-2nd which resolved a month long dispute (Note: changed from late June)
• Focus turns to FOMC rate decision

Asia:

• Japan May Trade Balance misses expectations as exports registered its 6th consecutive decline and largest decline since Jan (Trade: -¥0.97T v -¥1.205Te; Exports Y/Y: -7.8% v -8.2%e; Imports Y/Y: -1.5% v +1.0%e
• Japan MOF Asakawa (Japan's top currency official): Widely understood among G7 and G20 that BoJ's easy policy was aimed at beating deflation and not at manipulating currency
• PBoC and the Securities regulator's (CSRC) said to have met Banks and Securities companies for interbank liquidity

Europe/Mideast:

• ECB policy makers said to be divided on next step with rate cut, guidance change and further QE all as options
• UK Conservatives announced results of 2nd leadership ballots (total 313 votes; 33+ needed to move on). Boris Johnson 126 votes; Michael Gove 41 votes; Jeremy Hunt 46 votes; Rory Stewart 37 Votes; Sajid Javid 33 Votes with Dominic Raab being eliminated (30 Votes)
• Labour's Corbyn (opposition) expected to back Labour move to change its Brexit policy and support second referendum in all circumstances

Americas:

• President Trump asked White House lawyers on options for removing Fed Chair Powell, they found removal would be very questionable. (Reminder: President Trump stated that "Let's see what Fed Chair Powell does tomorrow" (responding to question about report that White House looked at legality of demoting Powell)
• President Trump said to be considering sanctions on Turkey for buying S-400s from Russia

Energy:

• Weekly API Oil Inventories: Crude: -0.8M v +4.9M prior
• OPEC Secretariat proposed new OPEC+ meeting date of July 1st-2nd (Note: Changing date from June 25-26 requires OPEC consensus)

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

• Indices [Stoxx600 -0.2% at 383.9, FTSE -0.4% at 7416, DAX -0.1% at 12320, CAC-40 -0.2% at 5500, IBEX-35 -0.4% at , FTSE MIB 0% at 21216, SMI -0.6% at 9946, S&P 500 Futures -0.10%]
• Market Focal Points/Key Themes: European Indices trade lower across the board consolidating after sharp gains yesterday, following a strong session in Asia and flat futures in the US. On the corporate front shares of Mulberry gains as the company still posted a profit despite pressures from the closures of House of Fraser stores; Quartix gains following a trading update, while CYBG also gains after affirming its guidance and revealing longer term outlook at its Capial markets day. Shares of Saga continue to fall following its trading update, noting Tour Operations is being impacted by current political uncertainties; Berkly Group and Immonodiagnostic Systems also decline on earnings with Oriola another notable decliner after cutting cutting its outlook and announcing job cuts. In other news XXL gains following Altor stake raise, while International Consolidated Airlines declining after signing an LOI to acquire 200 aircraft from Boeing. Looking ahead notable earners include Winnebago, Fred's and Barnes and Noble.

Equities

• Consumer discretionary: Mulberry [MUL.UK] +4.7% (Earnings), SAGA [SAGA.UK] -12% (trading update), International Consolidated Airlines [IAG.UK] -5% (Airplane order), MQ Holdings [MQ.SE] -12% (earnings)
• Financials: Berkeley Group [BKG.UK] -1.9% (Earnings)
• Healthcare: Immniodisagnostic Systems [IDH.UK] -10% (Earnings), Oriola [OKDAV.FI] - 4% (Cuts outlook)

Speakers

• France Budget Min Darmanin stated that its budget deficit goals had not changed even with cuts in local taxes. Forecasted 2020 budget deficit around 2.0% of GDP and 2022 budget deficit at 1.2% of GDP
• Italy PM Conte said to warn EU on any divisive decision regarding debt procedure. Reiterated vow to respect EU rules but also wanted to change them to cope with crisis
• BOJ Etoh reiterated overall assessment that domestic economy was expanding moderately as a trend but uncertainties did exist
• Iran Atomic Energy Organization: Iran would not extend the 60-day deadline to withdraw from some key commitments under nuclear deal
• China Foreign Ministry spokesperson Lu Kang: US and China willing to have contact and dialogue on trade. Added that was possible to achieve a possible outcome on trade talks (reply to question)
• UAE official stated that OPEC needed to extend oil production cuts as inventories rise. OPEC still needed to set meeting date but early July period was likely
• OPEC Delegate: OPEC+ agreed to move meeting date to July 1-2nd period

Currencies/Fixed Income

• Markets in a pause mode following the dramatic decline in bond yields in Europe yesterday as Draghi opened the ECB forum in Sintra on a dovish note with the sentiment reverberating throughout the globe. Markets saw new all-time yield lows for 10-year bonds in Germany, Denmark, Netherlands, Austria, Finland, Sweden, France, Belgium, Slovakia, Ireland, Slovenia, Latvia, Spain, Portugal, Cyprus and Croatia
• Market took Draghi Sintra speech as a U-turn compared to the June ECB meeting. The ECB has joined the Fed and the question is how much easing there was there to come.
• EUR/USD steady around the 1.12 with USD/JPY at 102.45 area

Economic Data

• (DE) Germany May PPI M/M: -0.1% v +0.1%e; Y/Y: 1.9% v 2.1%e
• (SE) Sweden Jun Consumer Confidence: 93.8 v 92.7e; Manufacturing Confidence: 100.2 v 104.7e; Economic Tendency Survey: 98.1 v 99.5e
• (SE) Sweden May Unemployment Rate: 6.8% v 6.5%e; Unemployment Rate (Seasonally Adj): 6.4% v 6.2%e; Unemployment Rate Trend: 6.3% v 6.3% prior
• (ZA) South Africa May CPI M/M: 0.3% v 0.3%e; Y/Y: 4.5% v 4.4%e
• (ZA) South Africa May CPI Core M/M: 0.0% v 0.1%e; Y/Y: 4.1% v 4.2%e
• (EU) Euro Zone Apr Current Account: €20.9B v €24.7B prior
• (IT) Italy Apr Total Trade Balance: €2.9B v €4.6B prior; Trade Balance EU: €1.0B v €1.2B prior
• (PL) Poland May Employment M/M: -0.2% v 0.0%e; Y/Y: 2.7% v 2.9%e
• (PL) Poland May Average Gross Wages M/M: -2.5% v -2.9%e; Y/Y: 7.7% v 7.2%e
• (IT) Italy Apr Current Account Balance: €3.9B v €4.1B prior
• (UK) May CPI M/M: 0.3% v 0.3%e; Y/Y: 2.0% v 2.0%e; CPI Core Y/Y: 1.8% v 1.7%e; CPIH Y/Y: 1.9% v 1.9%e
• (UK) May RPI M/M: 0.3% v 0.2%e; Y/Y: 3.0% v 2.9%e; RPI-X (ex-mortgage interest payments) Y/Y: 3.0% v 2.9%e; Retail Price Index: # v 288.8e
• (UK) May PPI Input M/M: 0.0% v 0.2%e; Y/Y: 1.3% v 0.8%e
• (UK) May PPI Output M/M: 0.3% v 0.2%e; Y/Y: 1.8% v 1.8%e
• (UK) May PPI Output Core M/M: 0.1% v 0.1%e; Y/Y: 2.0% v 2.0%e
• (UK) Apr ONS House Price Index Y/Y: % v 1.3%e
• (HK) Hong Kong May Unemployment Rate: 2.8% v 2.8% prior
• (EU) Euro Zone Apr Construction Output M/M: % v -0.3% prior; Y/Y: % v 6.3% prior

Fixed Income Issuance

• (DK) Denmark sold total DKK2.44B in 2029 and 2039 DGB Bonds

Looking Ahead

• (UK) Conservative Party leadership 3rd ballot to narrow down candidates
• 05:30 (DE) Germany to sell €1.0B in 2.50% Aug 2046 Bunds
• 05:30 (PT) Portugal Debt Agency (IGCP) to sell €1.25-1.5B in 3-month and 12-month bills
• 05:30 (ZA) South Africa announces details of next bond auction (held on Tuesdays)
• 06:00 (UK) Jun CBI Industrial Trends Total Orders: -11e v -10 prior; Selling Prices: -3e v -1 prior
• 06:00 (PT) Portugal May PPI M/M: No est v 0.5% prior; Y/Y: No est v 1.9% prior
• 06:00 (SE) Sweden Central Bank (Riksbank) Jansson
• 06:00 (CZ) Czech Republic to sell bonds
• 06:00 (RU) Russia OFZ bonds auction
• (IL) Israel Jun 12-month CPI Forecast: No est v 1.3% prior
• 06:45 (US) Daily Libor Fixing
• 07:00 (US) MBA Mortgage Applications w/e Jun 14th: No est v +26.8% prior
• 07:00 (UK) Weekly PM May question time in House of Commons
• 08:00 (UK) Daily Baltic Dry Bulk Index
• 08:30 (CA) Canada May CPI M/M: 0.1%e v 0.4% prior; Y/Y: 2.1%e v 2.0% prior; Consumer Price Index: 136.2e v 136.0 prior; CPI Core- Median Y/Y: No est v 1.9% prior; CPI Core- Common Y/Y: No est v 1.8% prior; CPI Core- Trim Y/Y: No est v 2.0% prior
• 08:30 (CA) Canada May Teranet Bank House Price Index M/M: No est v 0.0% prior; Y/Y: No est v 1.2% prior; HPI: No est v 222.22 prior
• 08:30 (FR) ECB's Coeure (France) on panel at ECB forum
• 09:00 (BR) Brazil Jun CNI Industrial Confidence: No est v 56.5 prior
• 10:00 (EU) ECB chief Draghi closing remark at Sintra forum
• 10:30 (US) Weekly DOE Oil Inventories
• (UR) Ukraine Q1 Final GDP Q/Q: No est v 0.2% prelim; Y/Y: No est v 2.2% prelim
• (CO) Colombia May Consumer Confidence Index: -6.6e v -9.6 prior
• 14:00 (US) FOMC Interest Rate Decision: expected to leave Target range unchanged between 2.25-2.50%; expected to leave Interest Rate on Excess Reserves (IOER) unchanged at 2.35%
• 14:30 (US) Fed Chair Powell post rate decision press conference
• 15:00 (AR) Argentina Q1 GDP Q/Q: No est v -1.2% prior; Y/Y: -5.7%e v -6.2% prior
• 15:00 (AR) Argentina Q1 Unemployment Rate: No est v 9.1% prior
• 17:00 (BR) Brazil Central Bank (BCB) Interest Rate Decision: expected to leave the Selic Target Rate unchanged at 6.50%

WTI oil maintains positive tone on Wednesday, following previous day's 4% rally sparked by fresh hopes of US/China trade deal. Positive signal was also boosted by draw in US crude inventories (API report on Tuesday showed draw of 0.8 mln bls vs previous week's build of 4.8 mln bls). Tuesday's strong advance generated additional bullish signal on close well above 10SMA, which previously capped the action of four consecutive sessions. Fresh bulls are hesitating ahead of key barriers at $54.54 (faling 20SMA) and $54.79 (10 June high), but maintain strong momentum and underpinned by north-heading converged 5/10SMA's in attempt to form bull-cross. Firm break above $54.54/79 pivots is needed to confirm double-bottom ($50.59/71) and open way for stronger recovery. Improved sentiment supports the notion, as markets await Fed rate decision and release of EIA crude stocks data (1 mln bls draw f/c vs 2.2 mln bls build previous week) for fresh signals. Broken 10SMA now marks pivotal support ($52.91) and only firm break here would neutralize bulls.

Res: 54.54, 54.79, 55.00, 55.75
Sup: 53.70, 53.26, 52.91, 52.59

The Fed meeting on Wednesday promises to be the highlight of the week, particularly in light of the events of the last 24 hours.

Between Trump announcing that he will hold a prolonged meeting with Xi next week, piling more pressure on the Fed to cut rates and criticising the ECB President for hinting at further stimulus, the attention on today's Fed meeting has only increased. The central bank is now under considerable pressure, with the White House so unhappy at the job that Powell is doing that it has reportedly considered demoting him, despite Trump having been the one to hire him in the first place.

These tactics didn't work too well for the President last year, with the Fed raising interest rates four times despite huge pressure being publicly applied. Will they do the same again and reassert their independence or will the memory of the previous policy mistake force their hand, calling into question how much influence the President is having on their judgement and decision making. One thing is clear, the current relationship is not healthy and is likely to lead to more bad policy decisions and questions around its independence.

The announcement regarding the meeting next week may buy the Fed some breathing space today but that puts even more scrutiny on the language of the text, the press conference and the economic forecasts. The Fed will likely indicate a willingness to cut interest rates if necessary but will it hint at doing so next month? And what will the dot plot say about their plans for the rest of the year? Not that we can read too much into them given how much hands on trade talks between the US and China.

OPEC to meet after G20

OPEC's website this morning confirmed that it's meeting will take place a few days later than initially planned, with it now seemingly penned in for 1 and 2 July, the latter of which will include allies including Russia. The decision to delay the meeting may well relate to the G20 and talks taking place between the US and China, with the trade war seen as the greatest threat to the global economy at the moment and one that has led to downward revisions to oil demand growth, weighing on prices.

With this in mind, the next couple of weeks could be very volatile for oil prices, with inventory data adding another cause for concern for producers, given the recent inventory numbers. API reported a slight reduction on Tuesday, which EIA is expected to confirm later on today, which may alleviate some of the downward pressure in the near-term.