Summary:The dollar rose in volatile trading on Friday, extending sharp gains from the previous session, as risk appetite waned and investors grappled with the prospect that higher borrowing costs still had a long way to go. Gold rebounded but posted its biggest weekly loss since mid-November after the Federal Reserve said it needed to raise interest rates further to curb inflation. Oil prices fell nearly 2.5 percent, tracking a broad selloff in global equities on fears of a looming recession after central banks in Europe and North America said they would continue their aggressive fight against inflation.Beijing time on Monday (December 19), this week the market ushered in the Bank of Japan interest rate resolution, the Bank of Japan governor Haruhiko Kuroda will hold a monetary policy press conference, the Bank of Japan Governor Haruhiko Kuroda is expected to reiterate the need to maintain monetary stimulus policy to ensure sustained inflation. In addition, the Reserve Bank of Australia released the minutes of its monetary policy meeting, and the WTO General Council meeting will be held until December 20.Data and news released the day before:U.S. stocks closed lower for a third straight session on Friday, the second straight weekly loss, as concerns continued that the Federal Reserve's campaign to curb inflation would push the economy into recession. Stocks have stumbled since the Fed raised interest rates by 50 basis points, as expected. Fed Chairman Jerome Powell's speech signaled further policy tightening, with policymakers expecting rates to breach the 5 percent mark in 2023, a level not seen since 2007.Comments from other Fed policymakers have added to those concerns. New York Fed President John Williams said Friday that the Fed could still raise interest rates more than it expects next year. He added that aggressive policy tightening was not expected to lead to a recession.For the week, the Dow fell 1.66 percent, the S&P 500 fell 2.09 percent and the Nasdaq fell 2.72 percent. Money market bets suggest the Fed will raise rates at least twice next year, each by 25 basis points, hitting a terminal rate of about 4.8 per cent mid-year before falling to around 4.4 per cent by the end of 2023.On the economic front, data showed U.S. business activity contracted further in December and new orders slipped to their lowest level in two and a half years, although slowing demand helped cool inflation. The tech-heavy Nasdaq closed below its 50-day moving average on Thursday, a key technical level seen as a sign of momentum. On Friday, the S&P 500 also closed below its 50-day moving average.Gold rebounded on Friday, but posted its biggest weekly decline since mid-November after the Federal Reserve said it needed to raise interest rates further to curb inflation. Spot gold rose 0.8 per cent to $1,791.59 an ounce, but is down about 0.3 per cent for the week. "A lot of traders are looking at the Fed and the European Central Bank, which have hinted at further tightening, and we've seen a sharp rise in global bond yields, which is why gold is down this week," said Edward Moya, a senior analyst at OANDA.The Federal Reserve raised interest rates by half a percentage point on Thursday, as expected, and Chairman Jerome Powell said the central bank will raise rates more next year despite growing fears of a recession. The European Central Bank and the Bank of England have hinted at similar rate hikes. Gold is considered a hedge against inflation, but higher interest rates raise the opportunity cost of holding non-yielding bullion.Commerzbank expects gold to fall back toward $1,750 an ounce before the Fed's current rate hike cycle is definitively over, and expects gold to rise to $1,850 by the end of 2023.Oil prices fell more than $2 on Friday, tracking a broad selloff in global equities on fears of a looming recession after central banks in Europe and North America said they would continue their aggressive fight against inflation. The Federal Reserve says it will raise interest rates further next year, even as the economy threatens to slip into recession. On Thursday, the Bank of England and the European Central Bank also raised interest rates to fight inflation.Both indexes climbed on a weekly basis, helped by gains in the first three days of the week. Brent posted its biggest weekly gain since early October, but the week before it posted its biggest weekly decline since August.Earlier, the U.S. Department of Energy said it would begin buying back oil to replenish the Strategic Petroleum Reserve (SPR) for the first time since a record 180 million barrels of oil were released from inventories this year. Oil prices then briefly recovered some of their losses.The dollar briefly fell after data showed US business activity contracted further in December, with new orders sliding to their lowest level in more than two and a half years, while weak demand helped inflation cool sharply.S&p Global said on Friday its preliminary US composite PMI output index, which tracks manufacturing and services, fell to 44.6 this month from a final reading of 46.4 in November, keeping it below the 50 mark, the threshold for contraction in the private sector, for the sixth straight month.Erik Bregar, director of FX and precious metals risk management at Silver Gold Bull in Toronto, said: "The weaker-than-expected preliminary PMI is not going to stop the Fed from raising rates, it was a hawkish week for the Fed and the ECB and the market got bloodedly bloodedly, which is why I think you saw the dollar stay in demand until the end." The jury is still out on whether the dollar has peaked. I think if risk aversion continues through the holidays, we could see a rebound in the dollar. This dollar momentum has some support for at least the next week or two."In afternoon trade, the dollar was down 0.9 per cent at 136.56 yen after hitting a two-week high in the previous session. The pound slipped 0.1% to $1.2165 and the euro fell 0.3% to $1.0597.The euro also fell on Thursday after the European Central Bank raised interest rates and signaled the hike was far from over, stoking fears of a potential global recession and sending investors into the safe-haven dollar. Federal Reserve Chairman Jerome Powell said policymakers expect U.S. interest rates to rise further and stay high for longer.New York Fed President John Williams ramped up his hawkish rhetoric on Friday, saying the central bank could still raise interest rates by more than it currently expects next year. The Fed expects the federal funds rate to peak at 5.1%.Still, financial markets don't seem to be buying the Fed's hawkish stance. The Fed funds futures market is already pricing in a rate cut through the end of 2023. "Few expect the Fed to follow through on Thursday's hawkish stance," said Karl Schamotta, chief market strategist at Corpay in Toronto.The dollar index rose 0.2% to 104.69 after bouncing more than 0.9% on Thursday. The index has surged about 9% this year as the Federal Reserve aggressively raises interest rates, sucking money back into dollar-denominated bonds. However, the dollar index has fallen about 8 per cent since hitting a 20-year high in September as slowing US inflation has raised hopes that the Fed's rate-raising cycle may soon come to an end.In Asia, the Bank of Japan will decide on policy on Tuesday, and while no changes are expected at the meeting, some market participants have begun to bet on some adjustment in stimulus measures as Governor Haruhiko Kuroda prepares to leave office in April.The risk-sensitive Australian dollar was down 0.2 percent at $0.6690. The Australian dollar fell 2.38 per cent in the previous session, its biggest fall since March 2020. However, the New Zealand dollar rose 0.7 per cent to US $0.6383.Technical analysis of the Dollar Index:The US index rose below 104.85 on Friday, and the decline was supported above 104.20, which means that the dollar is likely to keep rising after falling. If the US index falls above 104.30 today is supported, the target for future gains will be 105.00-105.25. Today, the short-term resistance of the US index is 104.95--105.00, and the short-term important resistance is 105.20--105.25. Today, the short-term support of the US index is 104.30--104.35, and the short-term important support is 103.90--103.95.Technical analysis of EUR/USD:The fall in Europe and the United States on Friday was supported above 1.0585, and the rise was blocked below 1.0665, which means that the short-term rise in Europe and the United States is likely to maintain a downward trend. If the rally in Europe and the United States is blocked below 1.0650 today, the target for the lower market will be 1.0565- 1.0535. Today, the short-term resistance in Europe and the United States is 1.0645--1.0650, and the short-term important resistance is 1.0690--1.0695. Today Europe and the United States short-term support in 1.0565- 1.0570, short-term important support in 1.0535- 1.0540.Technical analysis of gold:Last Thursday's fall in gold was supported above 1773.30, and the rise was blocked below 1795.00, which means that gold is likely to maintain a downward trend after a short-term rise. If gold rises below 1801.00 today, the target will be 1779.00-1766.00. Today, the short-term resistance of gold is 1800.00--1801.00, and the short-term important resistance is 1807.00--1808.00. Today gold short term support is in 1779.00- 1780.00, short term important support is in 1766.00- 1767.00.Financial Calendar:Financial events:Market volatility:European stock market close: The German DAX30 index closed down 96.88 points, or 0.69%, at 13,889.35 points on Friday, December 16;The FTSE 100 index closed down 90.47 points, or 1.22%, at 7,335.70 on Friday, December 16.The French CAC40 index closed down 70.14 points, or 1.08%