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Heating Oil bulls flee for the exit

Published Wednesday, February 25th, 2015

Janet Yellen took centre stage yesterday as investors keenly awaited for clues from her testimony to Congress on the Fed’s thought process regarding the timeframe for rate normalisation. The headline act of the day did not disappoint as she touched on the various phases that will lead to the first rate hike and stressed that the decision to do so will be purely based on economic indicators and “on a meeting-by-meeting basis”.

Although she foresaw an ongoing improvement in the US economy, the Chair of the Fed made sure to warn against the downside risks including low wage growth and subdued levels of inflation. The clarification offered to its forward guidance and signs that it was in no rush to raise rates bolstered sentiment and, along with encouraging US service sector and housing data, helped stocks on Wall St close at fresh record highs.

The bullish outlook was mirrored across the pond as Greece overcame another hurdle after the last minute economic reforms put forward by Athens were approved by the Eurogroup of finance ministers. The proposals, which included a pledge to press on with existing privatisations and a promise to control government spending, marks a climb down from the original measures demanded by the country’s left leaning leaders but should go some way to guaranteeing the embattled nation’s financial stability for the next few months.

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Posted by Stephen Brennock

Stephen Brennock joined PVM in 2013 after having worked as a project manager for a business development firm. He graduated with a degree in Business Management in 2007.