Oil lower in Asian trade ahead of Fed meeting

September 11, 2012 | 13:48

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Oil prices slipped in Asian trade Tuesday as sentiment took a hit after an unexpected decline in US consumer credit, analysts said.

New York's main contract, light sweet crude for delivery in October fell 29 cents to $96.25 a barrel and Brent North Sea crude for October delivery was seven cents lower at $114.74.

The US Federal Reserve reported consumer credit fell in July after 10 months of gains, raising concerns about confidence while unemployment remains high in the world's largest economy and oil consumer.

Investors are now focusing on a Fed policy meeting starting Wednesday, with expectations high that it will announce a new round of stimulus measures to boost the struggling economy.

Analysts said the Fed could strengthen its declared commitment to its near-zero interest rate, easy-money stance, or possibly go as far as approving a third round of bond purchases known as quantitative easing.

"Some investors believe that more indications of an economic slowdown in the United States have increased the likelihood that the US Federal Reserve's two-day policy meeting ending on Thursday will result in a third round of bond buying," Phillip Futures said in a report.

AFP

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