The "breakfast table" inflation we were seeing six months ago is gone and in its place is a signal that the economy could easily tip over.
Paradoxically the decline in commodity prices, especially the energy complex, is one of the factors allowing what growth we see by acting as a tax cut for many.
Last I saw WTI was changing hands at $82.32
From Bloomberg:
Oil fell a second day in New York, heading for the longest weekly losing streak in more than 13 years, on speculation the economies of the U.S. and China, the world’s biggest crude consumers, will slow and curb fuel demand.
Futures dropped as much as 2.6 percent. Federal Reserve officials need to assess the risk from Europe’s debt crisis and U.S. budget cuts before deciding on stimulus measures, Fed Chairman Ben S. Bernanke said to the Joint Economic Committee yesterday. China reports economic data tomorrow after cutting interest rates for the first time since 2008. Global crude supply is sufficient, Youcef Yousfi, Algeria’s energy minister, said before OPEC meets next week in Vienna.
“I don’t think anybody is really going to be carrying much of a position into the weekend with the China data dump,” said Nick Trevethan, a senior commodities strategist at Australia & New Zealand Banking Group Ltd. (ANZ) in Singapore who forecasts New York crude may drop to as low as $82 a barrel. “Certainly the market is concerned about what the data may bring.”
Oil for July delivery decreased as much as $2.23 to $82.59 a barrel in electronic trading on the New York Mercantile Exchange, and was at $82.86 at 5:49 p.m. Sydney time. The contract yesterday slipped 0.2 percent to $84.82, the lowest close since June 5. Prices are down 0.4 percent since June 1 and poised for a sixth weekly decline, the longest losing streak since December 1998. Oil has fallen 16 percent this year.
China Outlook
Brent for July settlement slid $1.59, or 1.6 percent, to $98.34 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract’s premium to West Texas Intermediate was at $15.48, from $15.11 yesterday.
China reports inflation, investment and output figures tomorrow that may signal the economy is weaker than the government anticipated as Europe’s debt crisis threatens global growth. The nation’s central bank reduced the one-year lending and deposit rates by a quarter percentage point yesterday and loosened controls on the cost of loans....MORE
