Before the publication of important US inflation data, investors could take a deep breath. Many investors are likely to use a possible breather to test the sustainability of the recent recovery. Yesterday's countermovement may have been driven primarily by short-term relief over the geopolitical situation. The geopolitical headlines had overshadowed the market in recent days. Ultimately, however, inflation and interest rates are likely to play a role in determining whether the recent price gains have any substance. In addition, the development of the oil price is likely to remain an important factor for inflation expectations and therefore also for monetary policy. Accordingly, developments on the markets are likely to be closely monitored.
All in all, the geopolitical constellation surrounding the Iran war remains fragile. New negative news could quickly dampen the mood again and impact the financial markets, particularly through rising oil prices.
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Geopolitical uncertainties not off the table - Strait of Hormuz remains effectively closed
The geopolitical uncertainties are likely to continue to occupy investors. After the hope of a timely end to the Iran war brought tangible relief on Tuesday, tensions have increased again. The US TV station CNN reported that Iran had placed around a dozen mines in the Strait of Hormuz in recent days.
„If for any reason mines have been laid and they are not removed immediately, this will have military consequences for Iran on an unprecedented scale,“ said US President Donald Trump.
The Strait of Hormuz is considered a strategic bottleneck. Around 20 percent of the oil shipped globally passes through the strait between the Persian Gulf and the Gulf of Oman in the east every day.
Focus on US inflation data - Numerous economic data expected on Friday
From the perspective of the economic data calendar, things should consequently get exciting this afternoon with the publication of fresh US inflation data (13:30). Economists expect a year-on-year inflation rate of 2.4%, compared to 2.4% in January.
According to estimates, the core rate of inflation (excluding the drivers energy and food) is likely to have risen by 2.5% in the same period (previously: 2.5%).
A whole host of potentially important US economic data is also on the agenda on Friday (13:30).
In addition to the core rate for personal consumption expenditure, new orders for durable goods, the US GDP growth rate and the rate for personal consumption expenditure also come into focus at the same time.
The „JOLTs“ (Jop Openings and Labor Turnover Survey) will be in focus at 3:00 pm.
Preliminary data on consumer sentiment from the University of Michigan round off the week at the same time.
West Texas Intermediate (WTI)
