Dollar Index (DXY00) on Friday rises +0.58% and posted 1-week high. The dollar on Friday increased the demand of President Trump’s threat to the threat of President Trump to impose 25% tariffs on goods from Canada and Mexico and apply 10% tariffs on Chinese goods on Saturday. The dollar also got support from Friday’s US economic news, showing that DEC individual expenses increased more than expected. The dollar increased due to the Hawkish comments of Fed Governor Boman and Chicago Fed President Gulasbi, indicating that they wanted to see low inflation before any additional ease of Fed policy.
US DEC personal expenses +0.7% m/m increased, +stronger than expectations of 0.5% m/m. DEC Personal Income +0.4% m/M increased, which is correct on expectations.
The US DEC core PCE Price Index, Fed’s favorite inflation gauge, increased +0.2% m/m and +2.8% y/y, right on expectations.
The US Q4 Employment Cost Increase +0.9%, which is correct on expectations.
US Jan MNI Chicago PMI weakened with expectations of 40.0, +2.5.
Fed Governor Boman said, “I would like to see progress in re -starting inflation before making and adjusting in Fed Fund Target Range.”
Chicago Fed President Gulasbi said they have “comfort” that American inflation is on the way to 2%, but it makes sense to slow down the speed or rate reduction because the fed is near the neutral rate.
Markets are giving exemption to 16% possibility for cutting -25 BP rate cuts at the next FOMC meeting on 18-19 March.
EUR/USD (^eurusd) fell by Friday -0.18% and posted 1-1/2 weeks less. Friday’s dollar strength is being weighed at the euro. In addition, the German economy signs of weakness in the German economy, the largest, the German January unemployment rate is unexpectedly reduced the euro after a 4 -year high and German DEC retail fall. The loss in euro after the ECB’s 1-year inflation of 1-year inflation is limited to the Euro after a height of 1-year, a Hawkish factor for the ECB policy.
ECB Dec 1-Year inflation expectations increased from +2.6% to +2.8% to 5 months higher than +2.7% expectations in Nov. The expectations of the December 3-year inflation were unchanged by +2.4%from Nov, right on expectations.
German DEC retail sales unexpectedly -1.6% m/m fell, weakened without any changes and the biggest decline in 2 years.
The German January unemployment rate unexpectedly increased at a high level of 6.2%, which shows a weaker labor market compared to the expectations of no change at 6.1%.
In the March 6 policy meeting, the ECB is giving exemption to the possibility of Swap 21% for cuts in 25 BP rate.
USD/JPY (^usdjpy) increased 0.54%on Friday. Yen came under pressure from the comments of BOJ Governor Ueda on Friday, who said that the BOJ would maintain the adjusted monetary policy until the underlying inflation gradually moves towards 2%. High T-Note yield was weighed on yen on Friday. Japan’s Tokyo Jan CPI was limited to the loss in Yen, which grew more than the fastest expected in 1-3/4 years, a Hawkish factor for the BOJ policy.
Japan DEC unemployed rate unexpectedly fell from -0.1 to 2.4%, which shows a strong labor market compared to the expectations of no change at 2.5%.
Japan DEC industrial production increased +0.3% meter/m, +stronger than expectations of 0.2% m/m.
Japan Dec Retail Sales fell -0.7% m/m, which was weak with expectations from -0.1% m/m.
Japan Tokyo Jana CPI increased +3.4% y/y, +3.0% y/y, stronger than expectations and the biggest increase in 1-3/4 years. Tokyo Jan CPI pre-fresh food and energy increased +1.9% y/y, right on expectations.
BOJ Governor e.g. said, “To get a gradual pickup in prices with a solid increase in wages, we need to support the economic activity by maintaining an adjustment monetary ease so that the underlying inflation gradually moves towards 2%. Go. “
February Gold (GCG25) was closed on Friday -10.50 (-0.37%) on Friday, and March Silver (SIH25) -0.228 (-0.70%) was closed. Precious metals left an early advance on Friday and told about Reuters that President Trump reduced long liquidity pressure after delay in tariffs against Canada and Mexico by 1 March. However, the report was later rejected by the White House, stating that President Trump said that proceeded with 25% tariffs on imports from Canada and Mexico and 10% tariff on Chinese goods on Saturday. Friday’s rally in the dollar index was weighed at the high levels of 1-week. In addition, the Hawkish comments on Friday with Fed Governor Boman and Chicago Fed President Gulasbi on Friday weighed on precious metals when they said that they favor lower inflation before any additional ease of Fed policy.
On Friday, precious metals were initially higher, a new record with gold was posted at a height of 7-week with the nearest flow high and silver. Safe-heaven demand is increasing the prices of precious metals on expectations that increase in tariffs can boost price pressure and increase demand for precious metals in the form of prevention of inflation. On Friday, the Dovish comments from BOJ Governor UDA increased the demand for precious metals as a store of value when he said that BOJ said that the BOJ would maintain a adjusted monetary policy until the underlying inflation gradually moves to 2%. .
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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