The dollar index (DXY00) on Wednesday rose by +0.20%. The dollar found some support from weakness in the yen after Tuesday’s sharp gains. The dollar also found support from Wednesday’s news that U.S. Dec consumer confidence rose more than expected to an 8-month high. Gains in the dollar were limited as a rally in stocks curbed liquidity demand for the dollar.
Wednesday’s U.S. economic news was mixed for the dollar. On the bullish side, the Conference Board's U.S. Dec consumer confidence index rose +6.9 to an 8-month high of 108.3, stronger than expectations of 101.0. Conversely, Nov existing home sales fell -7.7% m/m to a 2-1/2 year low of 4.09 million, weaker than expectations of 4.20 million.
EUR/USD (^EURUSD) on Wednesday fell by -0.11%. Strength in the dollar Wednesday weighed on the euro. The euro saw underlying support as European energy crisis concerns eased after European nat-gas prices Wednesday dropped to a 1-3/4 month low.
USD/JPY (^USDJPY) on Wednesday rose by +0.39%. The yen on Wednesday gave up some of Tuesday’s sharp gains and posted moderate losses. Higher JGB bond yields are a supportive factor for the yen after the 10-year Japan JGB bond yield climbed to a new 7-year high Wednesday at 0.487%, just below the BOJ’s new upper limit of its 10-year yield target range of 0.50%.
February gold (GCG3) on Wednesday closed unchanged, and March silver (SIH23) closed down -0.077 (-0.32%). Precious metals Wednesday finished steady to slightly lower. A stronger dollar Wednesday weighed on metals prices. Also, a rally in stocks Wednesday curbed safe-haven demand for precious metals. Gold garnered some support Wednesday as rising inflation expectations boosted demand for gold as an inflation hedge after the 10-year breakeven inflation rate rose to a 1-week high. Silver prices were under pressure after Wednesday’s news showed U.S. Nov existing home sales fell more than expected to a 2-1/2 year low, a sign of weak industrial metals demand.
More Precious Metal News from Barchart
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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.
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