Oil rose after U.S. retail sales increased by the most in five months and equities gained, signaling stronger growth and higher demand.

Crude advanced as retail sales rose 1.1 percent in February after a 0.6 percent gain in January, the Commerce Department said.

Prices also gained after data showed German investor confidence jumped to a 21-month high. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations advanced to 22.3 from 5.4 in February.

Oil for April delivery rose to $107.35 a barrel on the New York Mercantile Exchange. The price is up 8.4 percent this year.

Brent crude for April settlement on the London-based ICE Futures Europe exchange gained $1.11, or 0.9 percent, to $126.45 a barrel.

Gold prices fell below $ 1,700 on the eve of the U.S. central bank decisions on interest rates.

The main event for financial markets on Tuesday will be the U.S. Federal Reserve decision on monetary policy. Expect the central bank will report on plans to leave interest rates at a level close to zero, but does not indicate the possibility of additional stimulus measures.

Since the Fed announced the first phase of quantitative easing in late 2008, gold prices have more than doubled.

Investment demand for gold remains high, as evidenced by the growth of stocks ETF assets to a record high this week. By the end of trading Monday, the largest stock funds reached 70.887 million ounces, up from early March to 361,000 ounces.

April futures price of gold on COMEX has fallen today to $ 1683.3 an ounce.

Change % Change Last

Oil $106.41 +0.07 +0.07%

Gold $1,700.50 +0.70 +0.04%