It’s been a very choppy week in oil markets, with traders forced to digest the latest compromise deal from OPEC+ against the backdrop of more interest rate hikes and dampening prospects for the global economy. Resilience in the economy now is impressive but the longer it lasts, the more it will be met with higher interest rates that could ultimately deliver a harder landing.

That oil failed to break back into the band it was trading in between December and March despite a further cut from Saudi Arabia says everything about traders’ views on the economy. Not to mention that it will infuriate the Saudis who have once more failed to manipulate the price higher. What more can they realistically do?

Brent has been firmly entrenched in the $70-$80 range for more than a month now and if Saudi Arabia can’t get the rest of the alliance on board before the end of the year, you have to wonder what the bullish case for crude will be. Stronger growth is obviously one but that isn’t exactly conducive to ongoing rate hikes and stubbornly high inflation.

Gold choppy ahead of US inflation and the Fed next week

Gold has also been very choppy in recent weeks with the lack of conviction in the economic data not helpful in tipping the balance one way or another. The yellow metal has broadly traded between $1,940 and $1,980 and traders may now have an eye on the US inflation data on Tuesday, a day before the Fed meeting.

These events may ultimately determine whether gold breaks higher once more with potential record high ambitions or continues to correct lower, having so far fallen almost 7% from the March highs.

For a look at all of today's economic events, check out our economic calendar: www.marketpulse.com/economic-events/