US Dollar index Gains amid Rising European Risks

US Dollar index Gains amid Rising European Risks


The dollar index which measures the greenback against a basket of major currencies finished higher for the second consecutive day as investors rushed to safety amid growing market uncertainty. DXY gained 0.3% to 97.46, slightly short from posting a fresh 2018 high. Meanwhile, US Treasury yields bounced up with the 10-year yields rising to 2.896%. However, the 2-year yields remain higher than the 5-year yields.


The British pound dropped to $1.2480, the lowest since April 2017, weighed down by the latest Brexit developments. It is a tough week for May, her law party's lawmakers triggered a no-confidence vote in her leadership. A ballot will be held today between 18:00 and 20:00 GMT and announcement will be made as soon as possible afterward. The Brexit uncertainty led investors to neglect the recent surge in the average earnings index which jumped to 3.3%, the highest in a decade. The pound pairs will remain exposed to any headlines concerning Brexit.


Gold prices remain trading a tight range between a support zone near $1240 and the resistance zone near $1250. Despite the dollar strength, gold prices found support by investors' demand for safe assets. The silver ounce is hovering near the $14.60 level, and palladium is approaching the $1260 high again.


Oil prices surge on Libyan supply disruption and expectations that OPEC+ cut will help to balance the oil market. Moreover, the American Petroleum Institute reported that the weekly US oil stock fell 10.180 million barrels last week. The West Texas Intermediate crude futures rose 2.1% to $51.94, and the Brent futures added 1% to $60.48. Market participant awaits the official inventory numbers by the Energy Information Administration later today.

Major Economic Events

GMT Country Event Expectation Previous
13:30 US Core CPI (MoM) (Nov) 0.2% 0.2%
13:30 US Core CPI (YoY) (Nov) 2.2% 2.1%
15:30 US Crude Oil Inventories -2.990 -7.323


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