Latest news with #dollar
Zawya
a day ago
- Business
- Zawya
Gold ticks lower, markets digest tariff developments
Gold prices slipped on Friday as the dollar edged higher and markets digested the latest tariff developments, while a softer inflation report kept hopes for a U.S. rate cut alive. Spot gold was down 0.6% at $3,297.09 an ounce as of 09:38 am ET (1338 GMT) and was down 1.8% so far this week. U.S. gold futures fell 0.7% to $3,295.40. The dollar index rose 0.2%, making gold more expensive for other currency holders. A federal appeals court temporarily reinstated the most sweeping of President Donald Trump's tariffs on Thursday, a day after a U.S. trade court ruled that Trump had exceeded his authority in imposing the duties and ordered an immediate block on them. "Gold at this point in time is pulling back off these recent highs and is in a consolidation period," said David Meger, director of metals trading at High Ridge Futures. "Gold is under slight pressure as we're seeing a little lesser need for safe-haven but it does look like there is going to be significant push back from Trump and that will eventually help prices." On the data front, the U.S. Personal Consumption Expenditures Price index (PCE) was up 2.1% year on year in April versus a 2.2% forecast. After the report, traders continued to bet that the U.S. central bank will cut its target for short-term borrowing costs in September. Bullion, which thrives in a low-interest rate environment and is also used to hedge against inflation and uncertainty, hit a record high of $3,500.05 in April. Elsewhere, physical gold demand in India was subdued this week, as an uptick in domestic prices and a winding up of the wedding season kept buyers at bay. Spot silver fell 0.6% to $33.14, platinum eased 1.6% to $1,065.50 and palladium dropped 1% to $963.57.
CNA
a day ago
- Business
- CNA
US dollar drops as investors prepare for court battle on tariffs
NEW YORK :The dollar fell on Thursday as investors prepared for U.S. President Donald Trump to battle a U.S. trade court ruling on Wednesday that blocked most of his proposed tariffs. A federal appeals court late on Thursday, however, reinstated Trump's levies on imports. The order from the United States Court of Appeals for the Federal Circuit in Washington provided no opinion or reasoning but directed the plaintiffs in the case to respond by June 5 and the administration by June 9. The greenback showed little reaction to the news. Senior Trump administration officials earlier downplayed the ruling's impact, expressing confidence it would be overturned on appeal and insisting other legal avenues are available in the interim. "Markets were quick to realize that the ruling was sort of narrow, meaning it was only focused on one aspect of the tariff plan here - emergency authorization," said Brad Bechtel, global head of FX at Jefferies in New York. "There were still plenty of other avenues for Trump." The dollar had rallied on the ruling. The U.S. currency has weakened on concerns that tariffs will slow the economy and reignite inflation, while the erratic implementation of Trump's policies is seen as denting the appeal of U.S. assets to foreign investors. "The deeper issue remains a persistent lack of clarity surrounding trade policy," said Uto Shinohara, senior investment strategist at Mesirow Currency Management in Chicago. The Federal Reserve has kept interest rates on hold on concerns about higher inflation as Fed officials wait to see how the trade policies will affect the U.S. economy. Trump, in a private meeting at the White House on Thursday, told Fed Chair Jerome Powell he was making a "mistake" by not lowering interest rates. "This is not likely to be the end of tariff policy, and in some respects, if the administration wins its appeal or opts for alternative legal paths to tariff implementation, they could aim for the tariff agenda as a whole to be more entrenched than it was previously," Goldman Sachs' forex analysts said in a report on Thursday. U.S. economic pessimism declined earlier this week after Trump on the weekend delayed a plan to impose 50 per cent tariffs on European Union imports. The euro was last up 0.73 per cent at $1.1374 after falling to $1.1209, the lowest since May 19. Against the Japanese yen, the dollar weakened 0.57 per cent to 143.99. It earlier reached 146.28, the highest since May 15. The dollar fell 0.59 per cent to 0.822 Swiss franc. The greenback also weakened on news that the number of Americans filing new applications for jobless benefits rose more than expected last week, and the unemployment rate appeared to have picked up in May, suggesting increasing layoffs as tariffs cloud the economic outlook. Investors are also watching the progress of a tax cut and spending bill that is working its way through the U.S. Congress and which is expected to add trillions in U.S. debt over the coming decade. Some Republicans have criticized it for not having enough spending cuts. Trump's budget chief said on Wednesday the White House intends to send Congress a package next week to formalize cuts made by billionaire Elon Musk's team targeting federal government spending. Longer-dated U.S. Treasury yields rose last week and demand for the Treasury's 20-year bond auction was soft due to rising concerns about the deteriorating U.S. fiscal outlook. The yen also weakened against the dollar earlier this week on reports that Japan will consider trimming issuance of super-long bonds in the wake of recent sharp yield increases in the country.
Bloomberg
a day ago
- Business
- Bloomberg
The End of the Easy US Stock Bet Has Been Good to Contrarians
On Wall Street, it's been years since anyone had to think very hard to make money. Buy the largest US stocks, ignore everything else and watch your portfolio soar. Investing was reduced to one-click simplicity. Then life got more complicated. President Donald Trump's sudden tariff escalation in April offered a glimpse of what a world without that certainty might look like. Confidence wavered—not just in megacap resilience, but in American economic exceptionalism and Trump's market-friendly reputation. But after a sharp market decline, some of the panic subsided. The president backed away from some of his most dramatic tariff plans, and major US equity indexes bounced back. On May 28, a US trade court said many of Trump's tariffs were illegal, with the administration appealing the decision. Yet for many, the market and political mayhem highlighted the increasing fragility of the one-way buy-America trade. You can still see the shadows of all that doubt in the lower value of the dollar, in Moody's Ratings' recent decision to downgrade America's debt, and in the steady drumbeat of money finding its way to anything that isn't just another bet on US stocks.
Zawya
a day ago
- Business
- Zawya
Sterling set for fourth monthly rise against a weakened dollar
Sterling held steady on Friday, set for its fourth month in a row of gains against the dollar, as recent favourable economic data support Britain's currency just as worries over U.S. tariffs and high debt weigh on the greenback. "Sterling looks well supported," said Kit Juckes, chief FX strategist at Societe Generale, pointing to "reasonably good" data trends. Sterling was last trading at $1.3472, little changed on the day and down around 0.5% on the week after gaining about 2% last week. That leaves the pound set to end May with a gain of around 1%, which would mark a fourth straight month of increases against a weakened greenback. It last recorded four consecutive monthly gains against the dollar in 2022. The dollar, meanwhile, was en route to its fifth-straight monthly decline on Friday, as further uncertainty around trade policy and U.S. fiscal health weighed. Sterling rose around 0.25% to 84.06 pence per euro. Still, it was set for its first week of declines after six weeks of increases as gains seen after UK retail sales and inflation numbers last week and optimism around Britain's trade deals with the U.S. and India faded. Last week's stronger than expected UK inflation print caused markets to do away with bets for a rate cut at the Bank of England's policy meeting in June, with about 97% of traders now anticipating that the central bank will hold rates after a cut by 0.25 percentage points to 4.25% in May. "The economy has not got the legs to justify a significant strengthening (of the pound) from here," Juckes said. "I just think it's going to frustrate all the bears, left, right, and centre." Further out, traders looked ahead to a multi-year spending review by finance minister Rachel Reeves on June 11, with the government facing the challenging task of boosting economic growth while limiting spending and tax increases as it has pledged. (Reporting by Linda Pasquini. Editing by Dhara Ranasinghe and Mark Potter)
Zawya
a day ago
- Business
- Zawya
Gold falls as dollar strengthens ahead of key US inflation data
Gold prices fell on Friday as the dollar ticked up, while investors remained cautious ahead of key U.S. inflation data due later in the day to gauge the Federal Reserve's monetary policy trajectory. Spot gold was down 0.6% at $3,295.99 an ounce, as of 0841 GMT. Bullion is down 1.8% so far this week. U.S. gold futures fell 0.6% to $3,294.20. The dollar rose 0.2% against its rivals and is on track for a weekly gain, making gold costlier for foreign buyers. "The U.S. dollar is up slightly this morning, which could be a source of pressure for gold," said Carsten Menke, analyst at Julius Baer. "Barring a major surprise to the PCE data, I would not expect gold to show a meaningful reaction. That said, the market seems to be a bit more nervous as of late, suggesting that volatility should stay high in the short-term." The Personal Consumption Expenditures (PCE) index, the Fed's preferred inflation measure, is due at 1230 GMT. The data is likely to show that inflation rose 2.2% in April, according to economists polled by Reuters, compared with a 2.3% increase in March. "With U.S. core PCE looming large, there is some hesitance to take new long positions in gold," said Tim Waterer, chief market analyst at KCM Trade. Investors are currently anticipating 50 basis points worth of rate cuts by the end of this year, starting in October. Zero-yield bullion tends to do well in a low-interest rate environment. Meanwhile, a federal appeals court temporarily reinstated the most sweeping of President Donald Trump's tariffs on Thursday, a day after a U.S. trade court ruled he had exceeded his authority and ordered an immediate block. Spot silver fell 0.6% to $33.16 an ounce, platinum eased 0.8% to $1,073.80 and palladium dropped 0.4% to $969.79.
