Crude Oil Prices Ends Lower On Growth Concerns

(RTTNews) - U.S. crude oil ended lower on Monday, amid concerns over the health of the global economy even as the dollar weakened against a basket of some major currencies, with investors digesting a slew of economic reports from the U.S.

The U.S. economy, one of the world's bright spots last year, grew at a relatively lackluster pace in the first quarter, data revealed last week. While many analysts are chalking that up to unseasonably cold weather throughout much of the nation, others say that expectations should be tempered for the rest of the year.

Still, the U.S. dollar remains strong compared to other major currencies, weighing on commodities, including crude oil.

Meanwhile, speculations are rife that a nuclear deal could be reached with Iran gained strength, which could boost Tehran's oil exports significantly by at least 1 percent.

U.S. crude inventories kept rising last week, adding another 8.4 million barrels, according to government data.

Meanwhile, refinery maintenance has helped lift gasoline prices. Drivers are paying more at the pump than they were a month ago, with the U.S. national average jumping 12 cents from the previous week to $2.41 a gallon.

Light Sweet Crude Oil futures for April delivery, the most actively traded contract, shed $0.17 or 0.3 percent to settle at $49.59 a barrel on the New York Mercantile Exchange Monday.

Crude prices for April delivery scaled a high of $51.04 a barrel intraday and a low of $48.71.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 95.41 on Monday, down from its previous close of 95.47 on Friday in late North American trade. The dollar scaled a high of 95.51 intraday and a low of 95.06.

The euro trended higher against the dollar at $1.1197 on Monday, as compared to its previous close of $1.1196 on Friday in late North American trade. The euro scaled a high of $1.1246 intraday and a low of $1.1164.

On the economic front, a report from the Institute for Supply Management showed U.S. manufacturing activity growth to have slipped to its lowest in more than a year, with labor issues at West Coast ports continuing to cause problems for exporters. The ISM's purchasing managers index fell to 52.9 in February from 53.5 in January, its worst reading in 13 months. Economists expected the index to drop to 52.8.

U.S. construction spending unexpectedly fell in January, adding to concerns over the economy in the midst of winter lull for the second year running. Spending on U.S. construction projects declined 1.1 percent in January to a seasonally adjusted annual rate $971.4 billion, the U.S. Commerce Department reported Monday. Economists expected a 0.3 percent increase, following December's upwardly revised 0.8 percent growth.

U.S. consumer spending dropped for a second consecutive month in January, due largely to a big drop in gasoline prices. The Commerce Department on Monday said consumer spending slipped 0.2 percent after falling 0.3 percent in December. Analysts expected a slightly smaller decline of 0.1 percent. However, consumer purchases adjusted for inflation rose 0.3 per cent in January following a 0.1 per cent drop the prior month.

Personal income rose 0.3 percent in the month, just shy of economist expectations for a 0.4 percent increase.

The People's Bank of China reduced its benchmark rate by a quarter point in a surprise move on Saturday. The central bank lowered its one-year loan rate to 5.35 percent from 5.6 percent and the one-year deposit rate to 2.50 percent from 2.75 percent, effective Sunday. The central bank raised the deposit-rate ceiling to 1.3 times from 1.2.

China's manufacturing sector contracted at a slower pace in February, official data showed Sunday. A National Bureau of Statistics report showed the manufacturing purchasing managers' index, or PMI, to have edged up to 49.9 in February from 49.8 in January.

The manufacturing sector in China expanded at a faster pace than originally reported in February, a HSBC survey said on Monday with a revised PMI reading of 50.7. That's up from 49.7 in January, and was even higher than last month's flash estimate of 50.1.

Eurozone manufacturing sector growth remained stable in February, final data from Markit Economics showed Monday. The final Purchasing Managers' Index came in at seasonally adjusted 51, unchanged from January's six-month high. The reading was below the flash score of 51.1.

The euro area jobless rate declined to the lowest since April 2012, data from Eurostat showed Monday. The unemployment rate dropped marginally to 11.2 percent in January from revised 11.3 percent in December. It was forecast to remain at December's originally estimated rate of 11.4 percent. This was the lowest rate recorded since April 2012.

Eurozone inflation remained negative for the third straight month in February due to falling energy prices. Nonetheless, the rate of decline in overall prices slowed more than expected, diluting fears of deepening deflation even before the European Central Bank practically starts bond purchase this month.

According to flash estimates from Eurostat, the harmonized index of consumer prices fell 0.3 percent in February from last year, slower than January's 0.6 percent decline and the expected decrease of 0.5 percent. Final data is due on March 17. The decline in December was the first fall since October 2009 and the 0.6 percent decrease seen in January was the biggest decline since July 2009.

Meanwhile, British manufacturing activity was the strongest in seven months during February with growth in output and new orders strengthening further, creating more jobs, results of a survey by Markit Economics showed Monday.