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Crude trims gains, remains higher on improving U.S. consumer data

Published 05/17/2013, 11:49 AM
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Investing.com - Oil prices were up in U.S. trading on Friday though off earlier highs after a widely watched barometer on consumer sentiment far exceeded market expectations.

The data rekindled hopes that the U.S. economy continues to recover and will demand more fuels and energy going forward.

On the New York Mercantile Exchange, light sweet crude futures for delivery in June traded up 0.33% at USD95.47 a barrel on Friday, off from a session high of USD96.42 and up from an earlier session low of USD94.80.

The Thomson Reuters/University of Michigan's preliminary consumer sentiment index rose to 83.7 in May from 76.4 in April, surging past expectations for a rise to 78.0.

The report also said its inflation expectations for this month remained unchanged at 3.1%.

The numbers came a day after Federal Reserve Bank of San Francisco President John Williams said that monetary authorities may begin to unwind stimulus programs this summer and possibly end such policies by year end.

Philadelphia Fed President Charles Plosser, a known inflation hawk, added separately that the Fed should consider scaling back the program next month.

Monetary stimulus tools such as low interest rates, dovish language and the Fed's monthly USD85 billion asset-purchasing program weaken the dollar to spur recovery.

Weak industrial output, inflation data and other economic indicators had many investors betting in recent sessions that the Fed may prolong dismantling stimulus programs, which pressured the
dollar lower until Friday's data broke, though the dollar was up in U.S. trading on Friday.

A stronger greenback often makes oil a less attractive commodity in dollar-denominated exchanges, especially in the eyes of investors holding other currencies.

Elsewhere on the ICE Futures Exchange, Brent oil futures for July delivery were up 0.40% at USD104.19 a barrel, up USD8.72 from its U.S. counterpart.








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