OIL: Kazakhstan's Oil Output Decline Slows in December
Dec-10 11:43
Kazakhstan’s oil output decline slowed in early December after a Ukrainian drone strike on the CPC disrupted flows, Reuters reports citing an industry source.
- The CPC was damaged on Nov. 29 when SPM-2 was hit, reducing export capabilities.
- Kazakhstan’s oil & gas condensate production declined by 6% in the first two days of December from the average November level.
- The source said that a fall in average production in Dec. 1-9 slowed to 4.5% to 1.94m b/d.
- Kazakhstan's energy ministry said on Wednesday that the country plans to divert some Kashagan crude to China to offset reduced CPC capacity.
- Separately, the source said the Karachaganak field restored output to planned levels in December, lifting production by 2.5% from November after supplies resumed to Russia's Orenburg gas plant.
- The facility, the largest facility of its kind in the world, was forced to suspend its intake of gas from Kazakhstan in October after a Ukrainian drone attack.
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OUTLOOK: Price Signal Summary - USDJPY Trend Needle Points North
Nov-10 11:38
- In FX, EURUSD has recovered from its recent lows. The move higher, for now, appears corrective. A short-term recovery is allowing a recent oversold condition to unwind. Resistance to watch is the 20-day EMA, at 1.1587. It has been pierced, a clear break of it would signal scope for an extension towards the 50-day EMA, at 1.1627. The trend remains bearish. A reversal would refocus attention on the bear trigger at 1.1469, the Nov 5 low.
- A bear trend in GBPUSD remains intact and the latest recovery appears corrective. The move higher is allowing an oversold trend condition to unwind. Firm short-term resistance to watch is at the 20-day EMA, at 1.3237. A break of this hurdle would signal scope for an extension towards the 50-day EMA, at 1.3340. A resumption of the downtrend would pave the way for an extension towards 1.2971. The bear trigger is 1.3010, the Nov 4 and 5 low.
- The trend structure in USDJPY is unchanged, it remains bullish and the latest shallow pullback appears corrective. Moving average studies are in a bull-mode position, highlighting a dominant uptrend. The bull trigger is 154.48, the Nov 4 high. A break of this level would confirm a resumption of the uptrend and open 154.80, the Feb 12 high. First important support to watch lies at 152.46, the 20-day EMA.
STIR: Fed Rate Path Buoyed By Improved Shutdown Ending Odds
Nov-10 11:37
- Fed Funds implied rates are a modest 0.5-1.5bp higher for meetings out to mid-2026, helped by a marked improvement in odds of the government shutdown ending.
- Cumulative cuts from 3.87% effective: 16bp Dec, 25bp Jan, 35.5bp Mar, 41.5bp Apr, 55bp Jun.
- SOFR futures see larger moves, up to 4.5 ticks lower through 2027 contracts.
- It sees the terminal yield higher at 3.12% (H7) but still off Wednesday’s 3.16% marked the highest close since late July, following beats for ADP and ISM services before weaker alternate labor data and consumer sentiment over Thu-Fri.
- We don’t expect today’s Fedspeak to move the needle having heard from both recently.
- 0830ET - SF Fed’s Daly (non-voter, leaning dove) on Bloomberg TV. She’s spoken a few times since the Oct 29 FOMC, including in a blog post this morning firming her dovish leaning stance.
- 0945ET - St Louis Fed’s Musalem (’25 voter, hawk) on Bloomberg TV. He said on Nov 6 that policy is getting close to neutral and that the Fed needs to lean against above-target inflation. The labor market is around full employment but there are some downside risks to it.
EGB OPTIONS: RX Downside Being Rolled Out
Nov-10 11:32
RXG6 128 puts paper paid 52 on 8K vs. RXZ5 128.00 puts at 6.5, rolling out the curve.
