Oil Down, Dollar and Dow Up
Here is the Associated Press story filed minutes ago. In it, a trading firm president predict $3.50 a gallon gas by Labor Day, which would be more than a 35-cent drop from today’s national price of #3.83. The AP reports that a stronger dollar against the Euro was the main catalyst:
With the dollar launching a massive rebound against the euro and yen after the European Central Bank and the Bank of England both left their benchmark interest rates unchanged, energy traders found reason to sell — especially since the ECB indicated that there probably wouldn’t be any more rate hikes to come.
Also, gold is down to $877 an ounce.
This all says something about the strength of the U.S. economy. A good day like this was surprising given Russia’s military action in Georgia, pipeline problems in Turkey, and a larger than expected loss from mortgage-finance giant Fannie Mae. There may be a light at the end of the tunnel for the country’s financial woes yet.