Tuesday, with the support coming from last week’s strong and positive U.S employment data that kept investors hoping for another interest rate hike this year, the greenback managed to maintain stability. The greenback was traded at 93.412 – well above last week’s 92.548 which is considered as the currency’s 15-month low.
Investors do not rule out the possibility of another interest rate hike in the foreseeable future. In accordance to this, Bill Northey, chief investment officer at U.S. Bank Private Client Group in Helena, Montana, said that upon looking at the Federal Reserve’s future market, there was approximately fifty percent chance of another rate hike that year. He also noted that investors were waiting for signs as to when the Federal Reserve would begin shrinking its $.4.2 trillion bond portfolio.
Resumed production in the largest oil field in Libya and uncertainties about the OPEC-led production cuts continued to weigh on the market. The prices of oil kept on declining in Asian trading on Tuesday. Brent crude futures were traded at $52.14 per barrel, 0.4% or 23 cents lower. The United States West Texas Intermediate was traded at $49.21 a barrel declining by 0.4% or 18 cents.
On Monday, the Lybian National Oil Corporation said that Libya’s Sharara Field’s crude oil production was returning to normal output of 270,000 barrels per day; this is after a brief disruption as armed protesters broke into a control room in the city of Zawiya. It should be remembered that Libya is exempt from the OPEC-led agreement dealing with production cuts.