Natural gas futures slumped in American trade as the dollar index slipped, following a spate of data from the US, the world's largest energy consumer, including the EIA report that showed a larger-than-expected inventory buildup last week. 

 

As of 07:55 GMT, natural gas futures due on October 15 plunged 4.59% to $2.952 per million British thermal units from the opening of $3.094, with an intraday high at $3.096, and a low at $2.942, while the dollar index shed 0.30% to 92.23 from the opening of 92.51. 

 

Earlier US data showed a drop in unemployment claims, while the Philly manufacturing index widened unexpectedly in September, as the house price index accelerated below expectations in July.  

 

Additionally, the Energy Information Administration released its report on US natural gas inventories, showing a large buildup of 97 billion cubic feet in the week ending September 15, adding to the 91B increase in the previous reading, while analysts expected a 93B buildup. 

 

Total stocks have now reached 3.408 trillion cubic feet from 3.311 trillion in the week ending September 8, which is below the total of the same period in 2016 at 3.544 trillion, while above the five-year average at 3.341 trillion. 

 

Yesterday, Federal Reserve policymakers voted to hold overnight interest rates unchanged at between 1.00% and 1.25% in line with expectations in today's Federal Open Market Committee meeting, while announcing the start of the process to normalize the balance sheet from October.  

 

The FOMC expects to start normalizing the balance sheet from October to cut down on high levels of debt and mortgage-backed securities held by the Federal Reserve, as all the members agreed on the principles of normalizing the policy through the steps detailed in the additional document submitted alongside the usual bank statement in this meeting. 


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