Dollar Near 17-Months Low, Oil Gains On Easing Supply Fears

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The U.S. dollar (CURRENCY:USD) marginally firmed-up against the Japanese yen today, but was still seen trading near 17-months lows during the Asian trade. The defensive trade in the greenback is mostly due to the Japanese Prime Minister’s remark that hinted that the country’s authorities will not jump into containing the appreciation of the yen.

USD/JPY climbs marginally

USD/JPY was trading 0.11% up at 110.45 during the afternoon trade. Meanwhile, the consecutive fall in German industrial output released today dampened the outlook for the euro, which fell 0.29% to 1.1350 against the dollar. According to the data, German industrial output slipped 0.5% in February, which came in better than the projections of a 1.8% decline, however.

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Among equities market, European indices opened higher, driven by the recovery in oil prices and ahead of the minutes of March meeting of the Federal Reserve to be released later today. Britain’s FTSE 100 recorded the highest gains during the early trading hours, up by 0.50% to 6,121,57. On the other hand, Asian indices reported a mixed trading session with Taiwan taking the worst hit, closing 1.67% down at 8,513.30. The sentiment across Asian markets indicated a cautious approach following the sell-off in the European and the U.S. markets during the previous session.

API report

In the commodities market, oil bounced back strongly during the early European trade. Brent Crude surged 2.27% to $38.73, and West Texas Intermediate added 3.12% to $37.01. The iPath S&P GSCI Crude Oil Total Return (NYSEARCA:OIL) is up 1.64% in the premarket. The rebound in oil prices is being driven by speculations that the crude inventory build up in the U.S. will take place at a rate slower than anticipated.

The U.S. Energy Information Administration is scheduled to release a crude inventory report later today. A day earlier, the American Petroleum Institute estimated that U.S. oil inventories declined 4.3 million barrels during the previous week, which came in contrast to expectations of a 2.9 million barrel rise.

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