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FXstreet.com (London) - The week has started where it left off last week, with risk supported by the prospect of continuing support from the US Federal Reserve.

Speaking at her confirmation hearing before the Senate on Thursday, Janet Yellen gave all the right noises to anybody in the markets hoping for continuing ultra-dovish polish from the Fed. Yellen, who will take over from current chairman Ben Bernanke on 31 January, opined that while the economy had strengthened, there remained room for the Fed to continue to provide support. Her language and tone raised expectations that the Fed would be cautious in tapering its current USD85bn a month asset purchase programme.

Yellen’s confirmation put pressure on the dollar, but supported risk, with equity markets soaring to new highs. The Dow and the S&P rose 0.54 and 0.42 percent respectively on Friday and are likely to open with similar buoyancy today.

We have a light day ahead in Europe and in the US the focus will be on a number of speeches by Fed officials, with William Dudley and Charles Plosser speaking later today and Charles Evans speaking tomorrow.
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