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Gold tanks as Fed's Dudley hints at March US rate hike

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Rand Paul is fighting to make Republicans keep their promise to repeal Obamacare

Dow Jones closed up by 0.57 percent, S&P 500 ended up by 0.65 percent, Nasdaq finished the day up by 0.95 percent.

In his first address to a joint session of Congress late Tuesday, Trump said he wanted to boost the US economy with a "massive tax relief", overhaul the Affordable Care Act and make a $1 trillion effort on infrastructure.

Dow e-minis were up 82 points, or 0.39 percent, with 44,717 contracts changing hands.

"We're going to make it easier for states to address their infrastructure, and I'm going to have a big statement tomorrow night on infrastructure", Trump told governors visiting the White House. "If you're basing your projection on pro-growth and pro-business, it's based on the tax reform". It hit a 14-year high early January but is off 0.9 per cent year-to-date.

The US dollar clawed back earlier losses and was last up 0.2 per cent against a basket of currencies.

Meanwhile, the 10-year Treasury yield rose after moving little during the USA session, stoked by late Tuesday's commentary from Fed officials.

The more hawkish tone from those Fed officials on Tuesday have boosted the U.S. dollar, and have pushed up U.S. Treasury bond and note yields as well as government bond yields in Europe.

In contrast, the two-year Treasury yield, which is most sensitive to traders' view on Fed policy, was up over 3 basis points at 1.236 per cent.

Investors shouldn't despair, however: The Dow has risen by an incredible 2,500 points since the USA presidential election. Interest rate futures implied traders saw a almost 57 per cent chance the Fed will raise rates at its next meeting on March 14-15, up from roughly 31 per cent late on Monday, data showed.

Both Brent and WTI have traded above the $50 mark since the start of the year, but are showing little signs of an uptick to $60, as the upside risk of Opec production cuts and downside drag of rising U.S. production continue to cancel each other out.

Spot gold was down 0.1 percent at $1,250.93 an ounce by 3:10 p.m. EST (2010 GMT), below the previous session's 3-1/2-month high of $1,263.80. Brent crude settled down 0.6 per cent at US$55.59 a barrel while U.S. crude fell further to US$53.94 after settling down 0.07 per cent at $54.01.

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