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Daily Review 13.09.2016
 

RATE HIKE WATCH: Fed’s Brainard pulls off dovish stance, says September rate hike ‘unlikely’

The Fed limbo continues.

Last Friday, Boston Fed President Eric Rosengren claimed that chances on gradual interest rates increases are high amid an overheated economy.

But on Monday, Federal Reserve Governor Lael Brainard dampened bets on potential interest rate hike ahead of the policy meeting next week.

Brainard, the last official to give a speech, commented yesterday that the Federal Reserve should avoid removing support for the US economy too quickly, citing that before the Fed approves a rate hike, the economy should have first a stronger trend in US consumer spending and proofs of stronger inflation.

She also reiterated that US labour market was not yet at full strength and that policy tightening is not ideal.

MARKET WATCH: Patrolling Stocks, Dollar and Oil after dovish Fed commentaries

With yet another swing on Federal Reserve commentary yesterday, the market has once again responded as investors have been anticipating the last Fed remark ahead of September 20-21 meeting.

Wall Street bounced back from its previous worst day session as it closed sharply on Monday, with S&P 500 racking up its sharpest climb since July.

The energy sector advanced 31.23 points, or 1.47%, to close at 2 159.04, supported by the slight rise in oil prices. The Dow Jones industrial average gained 31.23 points, or 1.32% at 18 325.07 while the NASDAQ composite rose 85.98 points, or 1.68% at 5 211.89.

Most equities across major markets in the world ended in the bullish territory and were last up 0.3%.

Meanwhile, the US dollar recorded a session-low against euro and yen as the dollar index, which measure the greenback against major currencies, tumbles by 0.2%.

The greenback finished down 0.8% versus the Japanese yen and was last trading at 101.83 while the euro slightly advanced and closed at 1.1235.

In commodities, oil prices took advantage on a less firm dollar and a stronger US stock market as it surged up yesterday.

The West Texas Intermediate futures added 37 cents and were last trading at $46.25 a barrel while Brent crude oil futures rose 30 cents and finished at $48.31 per barrel.


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