Dollar Index (DXY00) rose 0.19%on Thursday. The dollar increased on Thursday over an increase in a possible trade war that will promote inflation and restrict Fed’s policy. President Trump threatened to make 200% tariffs on European liquor, champagne and other alcoholic beverages late on Thursday, if the European Union does not cancel the tax on American whiskey. Stock weakness also promoted some liquidity demand for dollars on Thursday. Thursday’s US economic news was added to the dollar as weekly unemployed claims unnecessarily fell and the prices of February increased less than expected.
The US weekly early unemployment claims unexpectedly fell from -2,000 to 220,000, showing a strong labor market compared to expectations of growing up to 225,000.
Barchart brief: The biggest news stories and investment trends were distributed in the afternoon
The US February PPI final demand unchanged M/m and rose +3.2% y/y, +0.3% m/m and +3.3% y/y were weak. In addition, February PPI pre -elaborate and energy -0.1% m/m and rose +3.4% y/y, +0.3% m/m and +3.5% y/y.
The market focus for the rest of this week will focus on American trade policies. Michigan University’s march of Michigan is expected to fall from the Consumer Affairs Index -1.2 to 63.5 on Friday. Finally, the market will also see if the Congress may approve the expenditure bill to stop the government shutdown before the March 15 deadline.
Markets are exempting the possibility of 1% for cutting -25 BP rate cut at the next FOMC meeting on 18-19 March.
EUR/USD (^Eurusd) fell on 0.31%on Thursday. The Euro slipped on Thursday when the Euros on the European Union, threatening to make 200% tariffs on the European Union, champagne and other alcoholic beverages, slipped on Thursday when the Euro slipped on the Europe, if the European Union does not cancel the tax on the US whiskey. The Euro was also under pressure due to the comments of Nagel, a member of the ECB Governing Council and president of the Bundesbank, who said that inflation would return to the 2% target of the ECB at the end of the year. On the positive side for the Euro, Eurozone Jaan Industrial Production recorded its biggest growth in 5 months.
Eurozone mass industrial production +0.8% m/m increased, +stronger than expectations of 0.6% m/m and the biggest increase in 5 months.
Nagel, a member of the ECB Governing Council and president of Bundesbank, said, “We will achieve price stability this year,” and eurozone inflation will return to 2% target of ECB by the end of 2025.
Swap is offering 47% probability at 47% for cutting -25 BP rate cut by ECB at the April 17 policy meeting.
USD/JPY (^usdjpy) fell on -0.36%on Thursday. Yen held a minor rally on the Hawkish comments of BOJ Governor Uaida on Thursday, who hopes he hopes that wages and consumer expenses for improvement in Japan. After the yield of T-Note, the yen was benefited on Thursday and left an initial advance and went less. There was a possible increase of the negative side trade tension after President Trump commented on Japan’s 204% tariff on the US Rice.
BOJ Governor Uaida said that he hopes that real wages and consumer expenses will improve for improvement in Japan as import inflation decreases while strong wage benefits continue.
April Gold (GCJ25) closed +44.50 ( +1.51%) on Thursday, and May Silver (SIK25) +0.563 ( +1.67%) was closed. Precious metals ralled the rally on Thursday, a contract with APR Gold posted a record of $ 2,988.00 an ounce with a contract high and closest-future gold (H25). The silver also increased to 4-1/2 months. The increase in business tension after President Trump threatened to make 200% tariffs on European alcohol, champagne and other alcoholic beverages. In addition, Thursday’s weak-to-first US February PPI report is for Fed Policy and supports precious metals. In addition, on Thursday, lower global bond yields supported precious metals. Buying funds as a prolonged gold position in ETF also supports gold.
Thursday’s dollar strength was a slowdown for metals. Silver prices are also under pressure due to concern that the increase of tariffs will initiate a trade war that will remove the demand for economic growth and industrial metals.
On the date of publication, Rich Escpland did not have the positions mentioned in any securities mentioned in this article (either direct or indirectly). All information and data in this article is only for informative purposes. For more information, please see the Barkart Disclosure Policy here.
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