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Dollar index hits March highs as Fed minutes support December hike

Turkish Lira falls to a record low, as equities suffer a sell-off

Gulf News

Dubai: Dollar extended gains to reach its highest level since March and stocks fell after the Fed minutes supported a rate hike in December amid worse than expected exports data from China.

The dollar index rose as much as 98.12, the level last seen in March. The Turkish Lira fell to its record low of $3.1130 against the dollar, while the pound fell early before trading flat at $1.2201. The rupee also weakened to be 0.60 per cent.

“The dollar is getting benefited as it all plays into higher interest rates and risk aversion,” Saleem Khokhar, head of equities at National Bank of Abu Dhabi’s asset management group.

“Dollar would continue to strengthen and we may see some weakness in the equity markets as we draw closer to the year,” Khokhar said.

The equity markets witnessed a sell-off with the MSCI world index falling to its lowest level in three months.

“They (emerging equity markets) had a good run-up till now, but risk aversion is creeping in due to earnings season and geopolitics,” Khokhar said.

The Euro STOXX 50 price index closed 1.58 per cent lower at 2,960.45. The German DAX was 1.35 per cent lower at 10,380.85. India’s Sensex index closed 1.56 per cent lower at 27,643.11.