Recent speeches by the heads of the Central Banks of developed countries and a number of international economists prophesy a general recession of the world economy at the end of the second quarter of this year.
Oil provided some protection against news negativity, but this driver may exhaust itself at the beginning of the new week. A portion of the statistics of GDP and unemployment of developed countries is likely to lead to a general decline in stock markets and, as a result, will cause an inflow of capital in dollars and securities of the US Treasury, and as a result, weaken national currencies.
An alternative scenario is a conflict with China, in this case, investors will return to the tactics of last year – the allocation of funds in major currencies. The past meeting between trade representatives of the countries hints at such a development of events. However, the results of this meeting did not lead to any specifics.
An important factor for the euro will be the size of the decline in Eurozone production, two times higher than similar statistics leaving Britain from the EU. It is possible that the pound in the future may show a faster recovery than the euro.
Statistics on oil reserves in OPEC will have a big impact on stock markets. Indices may fall if it turns out that countries have not reduced their volumes ahead of schedule, and demand is not recovering, with storage facilities crowded with cheap oil. In this case, the dollar will strengthen, despite the negative figures of producer prices. This will confirm the continuation of the economic downturn in May.