WTI struggles to regain $87 on soft US inflation data

Oil prices bounce up from $84.70 low to reach levels past $87.00. WTI is trading at $86.60 at the time of writing. The Dollar plunges on soft US CPI data and hopes of Fed’s rate hiking easing have boosted risk appetite.

WTI prices appreciated on Thursday to hit session highs right above $87 following a 7.5% selloff over the last three trading days. The US Oil benchmark, however, has been rejected at $87.25 before pulling back to the $86.50 area. Brent crude rose 94 cents, or 1%, to $93.59 a barrel by 12:52 a.m. EDT (1752 GMT).

Consumer inflation eased beyond expectations in October. The monthly CPI increased 0.4%, unchanged from September, against market expectations of a 0.6% advance. Yearly inflation increased by 7.7%, down from 8.2% in September, while the market had anticipated an 8% reading.

The Core CPI, a gauge closely observed by the Fed to assess inflation trends, accelerated at a 0.3% pace, from 0.6% in September. Year-on-year, the core inflation increased 6,3% from 6.5% in September, while the market has forecasted a softer deceleration, to 6.5%.

US weekly jobless claims data revealed that 225,000 workers filed for unemployment benefits in the week of November 4, up from 218,000 in the previous month and above the 220,000 expected. These figures add to the evidence that labor market conditions might be loosening, offering further reasons for the Fed to lift its foot off the rate hike pedal.