Oil prices fell for a second day on Wednesday on the potential of Iranian supply returning and as investors sold on speculation that inflation fears might lead the U.S. Federal Reserve to raise interest rates, which could limit economic growth.
Asian stocks dipped and cryptocurrencies extended losses on Wednesday as uncertainties over inflation prompted investors to reduce exposure to riskier assets for now.
U.S. stocks ended down on Tuesday, slumping on a sharp decline in telecom stocks and weak housing starts data that overshadowed better-than-expected earnings from Walmart (NYSE:WMT) and Home Depot (NYSE:HD).
The dollar was down on Tuesday morning in Asia, hitting a six-year low against its Canadian counterpart and hovering close to multi-month lows against European currencies, as investors ramped up bets that the U.S. Federal Reserve would not hike interest rates anytime soon.
Oil prices climbed on Tuesday, extending gains from the previous day, as optimism over the reopenings of the U.S. and European economies outweighed fears of slower fuel demand in Asia due to surging COVID-19 cases and a new wave of restrictions.
Gold was up on Tuesday morning in Asia as the dollar weakened. Investors also remain concerned about potential interest rate hikes to curb rising inflation.