arrel, the highest since April 19. The hope of further stimulus plans in China and signs of a tighter oil market bolsters the momentum of WTI. However, the market could turn cautious on Wednesday while investors await the Federal Open Market Committee meeting.
WTI has edged higher for four consecutive weeks, with supplies projected to tighten due to curbs by the Organisation of Petroleum Exporting Countries and allies such as Russia, known as OPEC+. The agreement by OPEC+ to limit supply through 2024 was announced in April and brings the total announced output reductions to over five million barrels per day , or approximately 5% of global oil production.
Furthermore, positive sentiment prevails ahead of the key events, bolstered by the hope of a further stimulus plan in China. On Tuesday, Chineseagency Xinhua reported that Chinese policymakers would take up economic policy adjustments, strengthening confidence and mitigating risks. This, in turn, supports further upside in the WTI price.
On the other hand, the upside for WTI might be limited. The Federal Reserve will announce its monetary policy decision on Wednesday. The Fed is widely anticipated to raise interest rates by a quarter percentage point to 5.25–5.50%. It’s worth noting that higher interest rates raise borrowing costs, which can slow the economy and diminish oil demand.
Apart from this, the IFO Institute's monthly survey showed on Tuesday that the German Business Climate Index in July decreased from 88.6 to 87.3. This result fell short of the market's estimate of 88.0. Additionally, the
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