US Dollar: Yellen Stays On Message But Highlights Risks Around Inflation Forecasts

Tech recovery lifts Wall Street

Tech recovery lifts Wall Street

US gold futures for December delivery settled down $13.90, or 1.07 percent, at $1,287.80 per ounce.

"Sustained low inflation such as this is undesirable because, among other things, it generally leads to low settings of the federal funds rate in normal times, thereby providing less scope to ease monetary policy to fight recessions", Yellen said. The Russell 2000 index of smaller-company stocks gained 4.91 points, or 0.3 percent, to a record 1,456.86.

An index of European banks rose 1.5 percent as the pan-European STOXX 600 share index rose 0.4 percent to a 10-week high.

US officials emphasized the urgency of attempts at diplomacy to ease tensions with North Korea on Tuesday, while the USA stepped up sanctions amid an escalating war of words between Washington and Pyongyang.

Investors were also optimistic about the U.S. tax reforms expected to be announced by Trump's administration and Republicans in Congress today at 1920GMT.

North Korea appears to have boosted defenses on its east coast, South Korea's Yonhap news agency reported, after Pyongyang said President Donald Trump had declared war and that it would shoot down USA bombers flying near the peninsula. For her part Janet Yellen stuck with a modestly hawkish tone and, when she had finished speaking, the chances of an interest rate rise in December was still priced at well above 70%.

I think U.S. Dollar traders had the wrong reaction to U.S. Federal Reserve Chair Janet Yellen's remarks on Tuesday.

The index is down by 9.7% since US President Donald Trump's inauguration.

Reports of Shooting at Tennessee Church
Metropolitan Nashville police spokesman Don Aaron identified the suspect as 25-year-old Emanuel Kidega Samson of Murfreesboro. Please join me in praying for the victims of today's church shooting in Antioch, victims' families and their community.

Cape Town - The rand lost more than 1.5% against the United States dollar on Wednesday, breaking through the level of R13.50/$ for the first time in nearly three months as the greenback rallied on rate hike hopes.

"While suggesting that the FOMC generally views the soft inflation numbers as transitory, she again gave credence to the notion that there is something structural going on in the economy that the Fed has yet to fully understand, which would warrant caution regarding the pace of hikes", says Royce Mendes, an economist at CIBC Capital Markets.

The U.S. Energy Information Administration will release stocks data later on Wednesday.

Comex December gold, at the session low of $1,285.30 an ounce, has lost almost 6% of its value since the one-year high of $1,362.40 on September 8.

Ten-year yields climbed seven basis points to an eight-week high of 2.30 percent, also pushed higher by the prospect of tax cuts that could increase federal borrowing, analysts said. It rose by as much as 0.3% earlier.

-West Texas Intermediate crude fell 0.5 percent to $51.94 a barrel.

The greenback also clawed back gains against the Japanese currency to fetch 112.73 yen.

-The euro sank 0.5 percent to $1.1792, the weakest in five weeks.

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