U.S. DATA
U.S. factories ramped up activity in September, shaking off a one-month contraction in a sign America was resisting the downward pull of the sluggish global economy.
The Institute for Supply Management (ISM) said on Monday its index of national factory activity rose to 51.5 from 49.4 the prior month, beating analyst expectations in a Reuters poll. Levels above 50 indicate the sector is expanding.
"This is a relief," said Ian Shepherdson, an economist at Pantheon Macroeconomics.
Factory output was a weak spot for the U.S. economy early in the year as a global slump weighed on American factories.
Fed’s Dudley Advises Caution in Raising Interest Rates
Federal Reserve Bank of New York President William Dudley suggested the central bank should be cautious in raising interest rates, given limits on its ability to respond to a recession with borrowing costs close to zero.
Noting concerns from some economists that the risk of a recession is increasing, Dudley told a central-banking seminar hosted at his bank that the Fed may have limited room to cut rates in the event of a downturn in the next few years. That may raise the need to turn again to unconventional policies, such as purchasing bonds.
“A risk management approach to monetary policy would suggest that the more concerned one is with the effectiveness of these policies at the zero lower bound, the more cautious one would be in the process of removing accommodation,” he said in the text of remarks Monday, posted on the New York Fed’s website. The event was closed to the media.
Oil prices dip on surging Iran sales, but looming OPEC deal offers support
Oil prices dipped early on Tuesday, weighed down by a rise in Iranian exports that adds to a global supply overhang, although a planned OPEC-led supply cut later this year has lent crude some support.
International Brent crude oil futures LCOc1 were trading at $50.79 per barrel at 0015 GMT, down 10 cents from their previous close.
U.S. West Texas Intermediate (WTI) crude CLc1 was down 15 cents at $48.66 a barrel.
Traders said prices were dented by the latest rise in Iranian crude and condensate sales, which likely reached about 2.8 million barrels per day (bpd) in September, almost matching a 2011 peak in shipments before sanctions were imposed on the OPEC producer.
Reference: Reuters, Bloomberg
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