Oil smiles on Bank of Japan moves

NEW YORK, Jan. 29 (UPI) -- Crude oil prices edged higher in early Friday trading after the Bank of Japan cut interest rates, though pressure could emerge from fourth quarter earnings.

The Bank of Japan announced it was introducing a benchmark rate of negative 0.1 percent, meaning banks would be charged for some deposits. The move is designed to push Japan's economy away from recessionary threats that have dogged the region.

Concerns about the pace of economic growth have clouded optimism about the pace of global expansion, though the bank said it expected moderate recovery moving forward.

"Against the background of steady improvement in the employment and income situation, private consumption has been resilient and housing investment has been picking up," the bank said in a statement.

Crude oil prices moved into positive territory in early trading Friday in response to the outlook. Brent crude oil moved up 1.8 percent to start the day in New York at $34.53 per barrel. West Texas Intermediate, the U.S. benchmark for crude oil prices, rallied in parallel to open trading at $33.84 per barrel.

The Dow Jones Industrial Average moved up more than 90 points to start the day. Oil prices and sector weakness had been earlier drags on U.S. stocks. U.S. major Chevron issued its fourth quarter report Friday, showing the first loss since 2002.

On the U.S. front, the Commerce Department issued an advance estimate of fourth quarter gross domestic product at 0.7 percent, against real GDP growth of 2 percent for the third quarter.

Russia, meanwhile, said it was keeping its interest rates unchanged, but expected recessionary strains to emerge if crude oil prices remained depressed. Europe, for its part, showed signs of growth with a flash estimate of January inflation at 0.4 percent, up from 0.2 percent in December.