9
April
UPDATE 2-Oil gains towards $86 on demand optimism
9 April 2010 Yahoo News
* U.S. March same-store sales up record 9.1 pct
* Revaluation of yuan seen boosting oil demand short term
* Coming Up: U.S. February wholesale inventories; 1400 GMT (Adds dollar drop, updates prices)
SINGAPORE, April 9 (Reuters) - Oil rebounded towards $86 on Friday after two days of declines, as positive U.S. economic indicators and views that China may revalue its currency bolstered expectations for sustained energy demand growth.
The dollar weakened more than 0.2 percent against a basket of currencies, raising the appeal of commodities and other riskier assets to investors. On Thursday, strength in U.S. retail sales boosted optimism about the economy and consumer demand.
The Chinese yuan and other Asian currencies rose briskly on Thursday as speculation intensified that China might soon revalue its currency and unveil a long-awaited shift in its exchange-rate regime. [ID: nSGE6370B2]
"Oil is a dollar-denominated commodity, so if the dollar gets weaker against the yuan, it will be cheaper for China to buy oil," said Clarence Chu, an energy trader at Hudson Capital Energy in Singapore. "In the short term, it could be bullish."
