Heating oil advanced on speculation that the Federal Reserve will act more aggressively to stimulate the economy.
Futures rose as Federal Reserve Bank of Chicago President Charles Evans said he would support a variety of measures to generate faster job growth. Prices of goods imported into the U.S. fell in May by the most in almost two years, reflecting lower costs for fuel and food.
“The import price decline gives the Fed some cover if they decide to act more aggressively on the stimulus front,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
July-delivery heating oil rose 1.15 cents, or 0.4 percent, to $2.6472 a gallon at 9:53 a.m. on the New York Mercantile Exchange. The contract is traded as a proxy for diesel.
“I’ve been in favor of pretty much any accommodative policy I’ve heard about,” Evans said in an interview on Bloomberg Television’s “In the Loop” with Betty Liu airing today.
Federal Reserve Bank of Atlanta President Dennis Lockhart said falling Treasury yields take pressure off the central bank for further action as policy makers prepare for a June 19-20 meeting of the policy-setting Federal Open Market Committee.
The 1 percent decrease in the import-price index, the biggest since June 2010, follows an unchanged reading in April, Labor Department figures showed today.
The Standard & Poor’s 500 Index rose 0.4 percent at 9:53 a.m. in New York after sliding 1.3 percent yesterday.
“Some of the selling pressure seems to be overextended and the equity market turned around,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.
Gasoline for July delivery rose 0.31 cent to $2.6597 a gallon on the Nymex.
Regular gasoline at the pump, averaged nationwide, rose 0.2 cent to $3.542 a gallon yesterday, according to AAA. It was the first increase since May 15.
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