Asian equities are trading positive with some relief from recent selling, and are assets kept afloat despite the weak lead and choppy mood seen on Wall Street. Trades will be keeping an eye on liquidity and potential short squeezes in the commodity/metal sector as prices soar. Traders are eying oil as benchmarks continue to trade higher as the U.S. and the U.K. move forward with plans to ban Russian oil and gas imports. At the same time, the E.U. also released its plans to cut its dependence on Russian energy significantly.
On the macro front, with the ongoing geopolitical tensions, markets are wary of further inflation pressures and slowing growth ahead. Chinese CPI/PPI is due today, with traders expecting a higher reading as high costs of raw materials and energy and increased labour expenses put pressure on suppliers in the services sector, which passed along a share of their higher costs customers. Worth noting that markets are not reacting as usual to the incoming macro data due to geopolitical tensions.
Later in the session, with only US JOLTS Job Openings data on tomorrow’s radar, the focus clearly turns to tomorrow’s ECB meeting and U.S. CPI inflation data ahead of the FOMC monetary policy decision next week.
