Oil Price, Dollar Creep Lower
Despite thin Asian trading that resulted from a Japanese holiday, the dollar edged down against its primary trading partners, with the dollar index starting the week at 100.140 .DXY, a 0.16 percent decline. The dollar traded at 112.54 against the yen, down substantially from a high of 115.51 set earlier this month. The dollar also lost ground against the euro, receding from Friday’s six-week peak of $1.0782 to trade on Monday at $1.0764.
Traders are now looking towards Federal Reserve comments, with nine policymakers set to speak this week as well as Fed Chair Janet Yellen who will speak on Thursday. Analysts are not expecting a rate hike at the Fed’s next meeting in May, and are split about the possibility of the next interest rate hike coming in June, with sentiment currently standing at 50-50 for a June hike.
Oil Prices Also Fall
Oil prices also fell on Monday after reports indicated that OPEC did not cut production as much as originally promised and that U.S. drilling continued to increase. U.S. drillers added 14 oil rigs during the past week, bringing the total to 631 barrels, the highest number since September 2015. U.S. oil production has risen to over 9.1 million barrels per day from below 8.5 million barrels per day last June. Nevertheless, some analysts are hoping that the full outcome of OPEC’s production cuts haven’t been seen yet and that despite the increase in U.S. production OPEC’s cuts will show effect in April, as demand from refineries increases.
Brent crude was down 29 cents per barrel on Monday, easing 0.56 percent to trade at $51.47 per barrel. U.S. WTI crude futures lost 0.78 percent, trading down 38 cents to $48.40 per barrel.
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