Crude oil slightly easier ahead of Fed decision
Oil fell slightly today, extending crude's sharp sell-off as the dollar strengthens ahead of the Federal Reserve interest rate decision later today.
The Fed is widely expected to cut rates by 25 basis points to 2.0 percent, which would typically weaken the dollar and boost commodities. However, rate setters in the world's largest economy are expected to signal a desire to hold rates there for the time being. That anticipation is lending the dollar support and reducing the appeal of commodities priced in the greenback.
"A dollar rally could likely derail the short dollar/long commodities play that has been working so well for much of the year," said MF Global analyst Ed Meir.
New York-traded West Texas Intermediate crude for June delivery dropped to an intraday low of $114.86 before firming to $115.40 by 12:20 p.m., a 23-cent decline from Tuesday's close, reports Thomson Financial.
The Fed is widely expected to cut rates by 25 basis points to 2.0 percent, which would typically weaken the dollar and boost commodities. However, rate setters in the world's largest economy are expected to signal a desire to hold rates there for the time being. That anticipation is lending the dollar support and reducing the appeal of commodities priced in the greenback.
"A dollar rally could likely derail the short dollar/long commodities play that has been working so well for much of the year," said MF Global analyst Ed Meir.
New York-traded West Texas Intermediate crude for June delivery dropped to an intraday low of $114.86 before firming to $115.40 by 12:20 p.m., a 23-cent decline from Tuesday's close, reports Thomson Financial.
