OPEC agrees to cut oil production
In an unexpected development, OPEC agreed to cut its oil production following yesterday’s meeting in Algiers. The range for output will be 32.5 million to 33 million barrels per day (b/d), which compares to the 33.5 million(b/d) it produced in August. The price of Brent crude has jumped by almost $2 to just shy of $49 per barrel
Bond yields are a touch higher on the OPEC news. US 10-year yields reversed an earlier fall to end up 2bps at 1.58%
The main exchange rates remain relatively becalmed. EUR/$ continues to hover around $1.12, while the euro remains at 86p against sterling
Equity markets advanced with both European and US indices adding around 0.5% on the day
Janet Yellen says the outlook for the US economy is consistent with gradual increases in interest rates with most Fed officials believing a hike by the end of this year will be appropriate
Data due today includes the EU Commission’s Economic Sentiment Indicator for the Euro area, mortgage approvals in the UK, and Q2 GDP (3rd estimate) and jobless claims in the US