Oil prices added to their already strong gains during the Asian morning. The catalyst was an explosion and fire that shut down the Iraq-Turkey oil pipeline. This pipeline normally carries over 100kb/d (I saw figures up 450kb/d) from northern Iraq into the Mediterranean port of Ceyhan. The disruption will further add to already tight supply conditions.

Otherwise fresh news catalysts were pretty much absent, as were any data of note. Thursday (Asia time) will bring a potential easing from the People’s Bank of China with the Loan Prime Rate (LPR) setting for the month.

There will also be Australian employment figures:

On Australian labour markets, we did get weekly payrolls data from Australia today which showed that in the year since December 19th 2020 payroll wages rose 9%. One of the factors the Reserve Bank of Australia is assessing is wage growth in Australia. They’ll take note of this. Westpac have provided a chart of job and wage growth – not the surge in 2021:

Australia wages 2021

On the FX front the majors were range bound and mainly quiet. NZD/USD popped a few points on a revised forecast for a higher end point for the Reserve Bank of New Zealand cash rate (3% vs. 2%, see bullets above).

USD/JPY popped earlier in the session with US yields rising slightly again. That pop has been unwound.