The major development that dominated financial markets last week apart from the increasing frayed political environment was the FOMC’s latest minutes from the February meeting of policymakers. While the Open Market Committee would like to see further progress on inflation and employment, there were some upside risks including proposed fiscal measures. The dollar was a little softer to close out the week, pushing gold prices back above $1250 for the first time in months.
Shifting to Europe, headlines centered on the approaching elections in the Netherlands and France. Fundamental data came in relatively positive, with both services and manufacturing indices expanding faster than anticipated while inflation data met expectations. In the UK, fourth quarter GDP was revised higher to 0.70% expansion from the 0.60% reported during the advance reading. Furthermore, Bank of England Governor Carney outlined more optimistic scenarios for Brexit, potentially even bringing about higher rates. Nevertheless, Europe is striking a more provocative tone towards any exit negotiations, asking for €60 billion in assurances to cover the UK’s outstanding EU commitments. To cap off the week, US crude oil production hit a new cycle high just above 9.000 million barrels per day as onshore crude stockpiles hit a new record.