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WTI recovers its losses above $74.00, US NFP data eyed

  • WTI prices recover some lost ground near $74.30 on Friday. 
  • The modest recovery in WTI prices is backed by expectations for Fed rate cuts and Chinese stimulus measures.
  • The US Nonfarm Payrolls report will be in the spotlight on Friday. 

Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $74.30 on Friday. WTI prices snap the two-day losing streak amid the sign of potential interest rate cuts from the US Federal Reserve (Fed). 

The modest recovery in WTI prices is supported by the market’s expectations for rate cuts this year after Fed Chair Jerome Powell indicated a peak of the rate hiking cycle during the press conference. It’s worth noting that lower interest rates typically stimulate economic growth which buoys oil demand. 

China has revealed measures to encourage development in its faltering property sector. Chinese authorities' emergency reaction and $1 trillion (US$141 billion) yuan liquidity injection helped boost market confidence. The positive developments surrounding China’s economy might lift WTI prices, as China is the world's second-largest oil consumer.

On Thursday, the Organization of the Petroleum Exporting Countries (OPEC) committee said that the group’s members will discuss in March whether or not to extend voluntary oil production cuts in place for the first quarter. The committee said there would be no changes to OPEC’s decision to slash 2.2 million barrels per day from the market this quarter.

Oil traders will closely watch the US Nonfarm Payrolls on Friday. Additionally, the Unemployment Rate, Average Hourly Earnings, Factory Orders, and the final reading of the Michigan Consumer Sentiment will also be released later in the day. These events could significantly impact the USD-denominated WTI price. Oil traders will take cues from the data and find trading opportunities around WTI prices.

 

PBoC sets USD/CNY reference rate at 7.1006 vs. 7.1049 previous

On Friday, the People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead at 7.1006 as compared to the previous day's fix of 7.1049 and 7.1655 Reuters estimates.
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Japanese Yen consolidates its weekly gains against USD as traders await US NFP

The Japanese Yen (JPY) enters a bullish consolidation phase during the Asian session on Friday and oscillates in a narrow range just below a two-and-half-week high touched against its American counterpart the previous day.
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