Asian equities could trade choppy as global peers closed negative after early relief from the mixed US Consumer Price Index data faded and with geopolitical concerns and upside in oil prices adding to the headwinds. Oil prices recovered with WTI above the $100/bbl level and Brent crude closer to USD 105/bbl. Traders are also paying attention to China easing some lockdowns. On the geopolitical front, President Putin says Russia will continue its invasion of Ukraine and potential use of chemical weapons in Mariupol. These themes could keep commodities prices in general pressured short-term as positioning is becoming stretched amid the recent volatility.
Worth noting that markets are trading and looking for DM Central Banks to shift their Monetary Policy in the very short term. On the FX front, Euro was particularly weak ahead of Thursday’s ECB meeting and the souring Ukraine/Russia backdrop. Looking ahead, traders will be eyeing Chinese Trade data with no special expectations and, later in the session, the UK Consumer Price Index and the US Producer Price Index to gauge the recent hawkish pricing on the bond and equities space.
