Currencies continued receiving pressure Tuesday as the U.S. Dollar (.DXY) hit a four-month high against the yen. There were heavy falls among defensive consumer staples and property stocks, a dip in the commodity sector as oil stumbled.
Federal Reserve chief Janet Yellen starts two days of testimony on Wednesday as the Federal Reserve prepares to unwind the massive hoard of bonds it bought to ease the financial crisis, while top ECB and Bank of England policymakers were due to speak in Europe on Tuesday.
Roger Webb, Head of European Credit at Aberdeen Asset Management said slightly stronger-than-expected global growth numbers recently had boosted expectations of higher interest rates.
"I think the increased hawkishness we have seen from the central banks has led to a fear that we could see a mini-taper tantrum. I don't think there is too much alarm. I think the move to slightly higher yields in Europe and the U.S., UK and elsewhere is probably understandable," he said.
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