Rates as of 0500 GMT

Market Recap

Yesterday was mean reversion day as the market largely reversed Tuesdays movements. JPY which had been the 1 gainer on Tuesday was the 1 loser, while the commodity currencies rebounded although NZD, the biggest loser for two days straight, was not the biggest winner. That was CAD, which rose as oil down 5.0 when I started writing yesterday morning rose 4.4 during the day.

Although the weekly US Energy Information Agency oil inventory report showed total crude and product inventories rose by the largest amount since December, it also showed the highest domestic gasoline consumption in four months and Gulf Coast refiners consuming more oil as they continue to recover from the cold snap there in February.

There are signs that travel bottomed out in January and has been reviving in the US and UK. It had been recovering in the EU until recently but has started to turn down once again.

Also, the gridlock in the Suez Canal continued as that ship I mentioned yesterday is still stuck. Its one of the largest container ships in the world 400 meters long, somewhere between the Eiffel Tower and the Empire State Building and is fully loaded, so its really, really stuck. Estimates are that it may be blocking 2mn barrels a day of oil and petroleum products. Of course, even if the canal were shut ships could still go around Africa, but that takes a lot longer, which increases the price of oil more interest on the money borrowed to buy the oil…