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Oil back up to $78 dollars a barrel after overnight gains

US Dollar:
The U.S. dollar continued with a mixed bias in late overnight trade, holding on to slight gains against the yen but losing ground versus the euro against a backdrop of still-cautious risk sentiment although month-end flows kept the euro-zone currency afloat near morning highs. In overnight testimony, Federal Reserve Chairman Ben Ber¬nanke noted regulators were "looking into a number of questions," concerning Goldman Sachs derivative ar¬rangements with Greece and whether they could have helped the country mask the reality of soaring deficits. "While Fed Chairman Bernanke's testimony passed relatively quietly, recent U.S. data has raised some con¬cern, notably on the consumer confidence and labour market front," said analysts at UBS. "We still think the dollar can remain supported as the Fed continues on the path towards normalizing policy and sovereign con¬cerns remain elsewhere."
DATA : Gross Domestic Product, Personal Consumption and Existing Home Sales
The British Pound traded lower against most major currencies as traders prepared for the fourth-quarter Gross Domestic Product report to cross the wires. Sterling only managed to advance against the Yen, which broadly declined on firming risk appetite. Preliminary UK Gross Domestic Product figures are set to show the economy added 0.2 percent in the fourth quarter, topping the 0.1 percent increase recorded in the three months through September. However, traders are likely to look past the headline figure for the source of expansion amid grow¬ing concerns that last year’s global rebound may lose momentum amid the fading effects of stimulus measures. A narrow improvement in Private Consumption coupled with an equally small decline in Government Spending seem to be encouraging, but a dramatic slowdown in Gross Fixed Capital Formation and its implications of stub¬bornly high unemployment may prove hard to swallow.
DATA : GDP figures, Private Consumption and Gross Fixed Capital Formation    

The euro neared a nine-month low against the dollar and hit a one-year low versus the yen as worries about a sovereign debt default in the euro zone grew after ratings agency Standard and Poor's said late on Wednesday it may cut Greece's rating one or two notches within a month. Investors' appetite for risk fell further after first-time filings for U.S. unemployment benefits unexpectedly rose in the latest week, fueling concern about the la¬bour market. The euro fell earlier to as low as $1.3452, near a nine-month low of $1.3442, according to Reuters data. But it reversed losses and rose to $1.3571 as U.S. stocks cut some of its declines. It was last 0.15 percent up at $1.3553. But traders cautioned against reading too much on the move and said despite the bounce, senti¬ment on the single currency remains negative.
DATA : German Consumer Price Index, Euro-Zone Consumer Price Index            

•  Oil prices rebounded above $78 a barrel overnight after sliding more than 2 percent the day before, lifted by a weaker dollar, but worries over the U.S. economy weighed on the market.   


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