By Adedapo Adesanya
Brent rose by 44 cents or 0.5 per cent to $84.75 per barrel on Thursday, boosted by signs of a strong economic rebound in top crude importer China and easing worries of aggressive US rate hikes.
Also, during the session, the US West Texas Intermediate (WTI) crude futures appreciated by 47 cents or 0.6 per cent to trade at $78.16 a barrel. as the market continued to harp on data that showed that manufacturing activity in China grew last month at the fastest pace in more than a decade.
According to data published on Wednesday, the manufacturing purchasing managers’ index (PMI) in the world’s second-largest economy shot up to 52.6 from 50.1 in January, according to China’s National Bureau of Statistics.
This is above the 50-point mark that separates expansion and contraction in activity. The PMI far exceeded an analyst forecast of 50.5 and was the highest reading since April 2012.
This added to evidence of a rebound in the world’s second-largest economy after the removal of strict COVID-19 curbs. The curbs were abruptly lifted in December as the highly transmissible Omicron spread across the country.
Prices also found support as US economic data showed a 1.7 per cent increase in Q2 2022 nonfarm business sector labour productivity. The US Bureau of Labor Statistics (BLS) on Wednesday said output had also increased by 3.1 per cent, with hours also worked up 1.4 per cent.
Additionally, the number of Americans who applied for unemployment benefits at the end of February fell slightly.
Also helping prices were comments by Atlanta Federal Reserve President Raphael Bostic, who said the Fed should stick with “steady” quarter-point rate increases for now in an effort to avoid an economic downturn.
The remarks eased concerns sparked earlier when strong US unemployment data had investors worried about the possibility of faster and bigger interest rate increases.
However, gains were capped by the growing expectations of rate increases by the European Central Bank (ECB) after a faster-than-expected acceleration in consumer prices in France, Spain, and Germany.
