• The dollar rose on Tuesday, bolstered by a widely expected U.S. interest rate increase from the Federal Reserve this week and bolstered by political risks in Europe as Dutch elections get under way.
The dollar index, which measures the greenback against a basket of six major currencies, climbed 0.4 percent to 101.71.
• The Fed started its two-day monetary policy meeting on Tuesday, with the futures market pricing in a 95 percent chance of a U.S. interest rate increase on Wednesday. The market is now focused on the Fed's so-called dot plots or interest rate forecasts.
• The euro, which hit a five-week high on Monday above $1.07 on expectations the European Central Bank could wind down its stimulus programme, fell 0.4 percent to $1.0609 on caution ahead of the Dutch vote. That extended falls from the previous day on comments by ECB officials that were seen as relatively dovish.
• Sterling fell to an eight-week low against the dollar and the basket of currencies measuring its broader strength on Tuesday, hit by fears of prolonged political jousting over the terms of Britain's exit from the European Union.
British Prime Minister Theresa May won parliamentary backing on Monday to begin the process of leaving the EU and start two years of talks that will shape the future of Britain and Europe. Having ridden out the latest political headlines on Monday while the dollar was weak, sterling traded as low as $1.2110 before recovering to $1.2163 by 1615 GMT.
• U.S. producer prices increased more than expected in February as the cost of services such as hotel accommodation pushed higher and the year-on-year gain was the largest in nearly five years, pointing to steadily rising inflation pressures.
Firming inflation, together with a tightening labor market, which is expected to generate strong wage growth, could allow the Federal Reserve to raise interest rates on Wednesday.
The index for final demand increased 0.3 percent last month after rising 0.6 percent in January. Economists polled by Reuters had forecast a 0.1 percent uptick.
In the 12 months through February, the PPI jumped 2.2 percent, the biggest advance since March 2012 and ahead of the 2.0 percent gain forecast in the Reuters poll. It followed a 1.6 percent increase in January.
• Falling oil prices weighed on energy shares on Tuesday in the wake of a report of rising crude stocks, while the U.S. dollar strengthened ahead of an expected Federal Reserve decision to raise interest rates.
U.S. crude prices CLc1 settled down 1.4 percent at $47.72 a barrel, touching their lowest point since Nov 30. Benchmark Brent crude LCOc1 settled down 0.8 percent at $50.92 a barrel.
• Oil slid after OPEC reported a rise in global crude stocks and a surprise output jump from its biggest member, Saudi Arabia. Even though OPEC made an upward revision to its global demand outlook, signs of even modestly higher Saudi output flustered investors.
• The Netherlands will vote on Wednesday in an election that is seen as a fresh test of the anti-immigrant, populist politics that swept across the West in 2016.
Polls suggest the government may lose about half its seats while the anti-Islam Party for Freedom (PVV) party of right-wing nationalist Geert Wilders surges. Though Wilders has little chance of winning enough seats to form a government, a PVV win would send fresh shock waves across Europe.
The polling stations will open at 7.30am local time (6.30am GMT) and will close at 9pm local time (8pm GMT).
After the polls close at 9pm local time (8pm GMT), the count begins at polling stations across the Netherlands.
Reference: Reuters, Express
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