Donald Trump’s 2018 budget was released earlier this week and it’s certainly caused debate. Trump’s plans will require the US economy to reach 3 percent growth by 2021. In the current economic climate there is questions being asked if the US will be able to deliver those sorts of results moving forward. However one of the Federal Reserve Board Members suggested that due to performance from nations around the world there is currently a slightly brighter global outlook.
The Eurozone has reported some positive months with Germany reporting some of the best business optimism in over 5 years. If some of that optimism can roll over into the US then the budget demands could be met. The latest proposal will be scrutinised in the Senate and there is an expectation that it’s unlikely to be passed. This could in the short term lead to a US shutdown and could cause complete chaos with a stand-off between the Republicans and Democrats.
OPEC Reach Agreement
This afternoon OPEC came to an agreement to continue with the restrictions on the amount of oil being produced. There has been a reduction of 1.8m barrels a day since the beginning of 2017 and this will now continue to the start of 2018. The news didn’t have too much of an effect on the value of oil because Trump has revealed plans to sell off half of the United States oil supplies over the next 10 years. This would essentially add millions of barrels to the market in the time where the industry is trying to manage profits.
US Data Tomorrow
There will be GDP released for the US tomorrow and there will also be Durable Goods Orders. Both of which will cause market movements if they are reported differently to what is expected.