The dollar index (DXY00) today is down by -0.06%. The dollar today is slightly lower ahead of any news of progress in the US-China trade talks that are currently underway in London. Lower T-note yields today have also weakened the dollar's interest rate differentials.
The markets are discounting the chances at 3% for a -25 bp rate cut after the June 17-18 FOMC meeting.
EUR/USD (^EURUSD) today is up by +0.09%. The euro today is modestly higher due to the weakness in the dollar. Also, hawkish comments today from ECB Governing Council member Kazimir supported the euro when he stated that the ECB is nearing the end of its easing cycle.
ECB Governing Council member Kazimir said the ECB is nearly, if not already, at the end of its interest rate cut cycle.
Swaps are discounting the chances at 14% for a -25 bp rate cut by the ECB at the July 24 policy meeting.
USD/JPY (^USDJPY) today is down by -0.18%. The yen today is moving higher on some better-than-expected Japanese economic news. The Japan May eco watchers outlook survey rose more than expected, and Q1 Japan GDP was revised higher. Lower T-note yields today are also giving the yen a boost.
The Japan May Eco Watchers Outlook survey rose +2.1 to 44.8, stronger than the expected 44.0.
Japan's Q1 GDP was revised higher to -0.2% (q/q annualized) from the previously reported -0.7%.
August gold (GCQ25) today is down -4.40 (-0.13%), and July silver (SIN25) is up +0.486 (+1.34%). Precious metals today are mixed, with gold falling to a 1-week low and silver climbing to a new 13-year high. Gold is under pressure due to reduced safe-haven demand amid hopes of progress in US-China trade talks. Also, hawkish comments today from ECB Governing Council member Kazimir undercut precious metals when he said the ECB is nearly at the end of its easing cycle.
Today's weaker dollar is supportive of precious metals. Also, continued buying of gold from China's central bank is bullish for gold prices after the PBOC reported Saturday that it added 60,000 troy ounces of gold to its reserves in May, the seventh consecutive month it has boosted its gold holdings. In addition, precious metals prices have continued safe-haven support from global trade tensions and geopolitical tensions in Ukraine and the Middle East.
Silver prices are moving higher today on supportive global economic news following Japan's revision of its Q1 GDP, which is positive for industrial metals demand. Fund buying is also supporting gains in silver after silver holdings in ETFs rose to a 2-year high last Friday.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
