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Daily Review 12.10.2016

Dollar rises to its seven-month peak; pound falls flat

Dollar surged to a seven-month high versus a major currency basket on Tuesday as investors turned up their bets that the Federal Reserve would raise interest rates in December.

The dollar index .DXY, which measures the greenback against six major currencies, rose 0.8 percent to 97.650 after hitting its highest since March.

The dollar slipped 0.3 percent to 103.38 JPY= against the yen but gained two percent so far this month.

Sterling continued to its downward hike following the “flash crash” last Friday. Over the past week, the British pound has lost more than 4 percent of its value against the dollar.

The euro dipped to a more than two-month low against the dollar, and was last down 0.8 percent at $1.1054 EUR=.

The British pound fell 1.8 percent to $1.2128 GBP=. Some analyst said there could be more expectations of further weakness in the pound as the impact of Brexit continues to unfold.

Oil price earnings took Wall Street’s center stage

U.S. stock index futures opened mixed on Tuesday as investors focus to the latest moves in oil, while keeping an eye out for new earnings releases.

Oil prices are set to be on big events on Tuesday after prices rose as much as 3 percent on Monday, helping both U.S. and European markets close in positive territory.

However, prices saw revived pressure on Tuesday, as doubts rose over whether a production cut would be enough. U.S. WTI traded around $50.85 per barrel, while Brent crude hovered at $52.70.

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