Investing.com - Here are the top five things you need to know in financial markets on Tuesday, March 14:
1. Dollar firms as Fed kicks off 2-day policy meeting
The Federal Reserve kicks off its two-day policy meeting on Tuesday, at which it is widely expected to raise the fed funds target range by a quarter point to a range between 0.75%-1%.
The U.S. central bank will also release its latest forecasts for economic growth and interest rates, known as the "dot-plot".
Fed Chair Janet Yellen's post-meeting press conference will be closely watched for clues on the pace of future rate hikes. Fed officials previously projected three rate hikes in 2017, but that might move up to four, amid signs of an uptick in inflation and continued strength in the jobs market.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up around 0.2% at 101.46 by 5:58AM ET (09:58GMT).
The benchmark 10-year U.S. yield was little changed at 2.619%, after rising overnight to 2.628%, its highest since mid-December.
2. Sterling tumbles as lawmakers clear path for Brexit
U.K. Prime Minister Theresa May won the right to trigger Article 50, which kicks off the process of exiting the European Union, after parliament passed legislation giving her the power to start the exit process on Monday evening.
The bill will now be sent to the queen for symbolic approval which could be granted as early as Tuesday morning, leaving May ready to start a two-year negotiation period before the end of March.
However, Scotland asked for a new independence referendum before the U.K. leaves the EU, adding to concerns the market has regarding Brexit.
The British pound sank to an eight-week low of 1.2109 against the dollar, before recovering to 1.2130, down about 0.7% for the day (GBP/USD).
The pound was also lower against the euro, with EUR/GBP advancing 0.6% to 0.8768, not far from Monday’s eight-week highs of 0.8786.
3. Dutch brace for election
Investors were focusing on the Dutch election, to be held Wednesday, which is being watched as a bellwether for the spread of populism in Europe, particularly ahead of next month's French election.
Opinion polls have suggested that Dutch nationalist Geert Wilders' right-wing Freedom Party, which wants to take the Netherlands out of the European Union and stop Muslim immigration, has lost its lead to more mainstream opponents.
However, a diplomatic standoff with Turkey threatened to overshadow the final stretch of campaigning and influence voting in Wilders' favor with less than 24 hours to polling day, prompting investors to remain weary over the possibility of a Brexit or Trump-style shock result.
4. Oil attempts slight rebound from 4-month lows
Oil prices attempted a slight rebound on Tuesday, after plunging to the lowest level since the end of November amid concern over rising shale production and record-high U.S. crude inventories.
U.S. crude was up 21 cents, or around 0.4%, at $48.60 a barrel, after touching an almost four-month low of $47.90 in the prior session.
Brent added 22 cents to $51.57, having dipped as low as $50.91 on Monday, its weakest level since the end of November.
Investors will keep an eye out for a monthly report from the Organization of Petroleum Exporting Counties due later in the session to gauge efforts by global producers to rebalance global oil supply and demand.
Meanwhile, the American Petroleum Institute is due to release its weekly stockpile report at 4:30PM ET (20:30GMT) Tuesday. Official data from the Energy Information Administration will be released Wednesday, amid forecasts for an oil-stock rise of 3.2 million barrels.
5. China data paints rosy picture
China's January to February economic data painted a rosier picture of the world's second largest economy, underlining the view that it got off to a strong start to 2017.
Industrial output grew by 6.3% in the first two months of the year from the same period a year before, beating expectations for 6.2% and up from 6.0% in the preceding month.
Fixed asset investment grew 8.9% on-year, as growth in private investment more than doubled from a year earlier.
But retail sales growth missed expectations, up just 9.5% on-year, missing forecasts of a 10.5% increase.