News

Greenback Extends Gains on Upbeat Data

USD

The dollar index which measures the greenback against a basket of major currencies settled higher for the fourth consecutive day supported by solid data. The Building Permits came in at 1.296 million beating estimates of 1.290 million, the Initial Jobless Claims fell to 212 thousand versus expectations of 220 thousand, and the Philadelphia Fed Manufacturing Index rose to 16.6 from 8.5 prior. The US 10-year yields surged to 2.416%, after dipping to a low of 2.35%, the lowest since late March, the USDJPY climbed to a high of 110.03, and the EURUSD tumbled to a ten-day low of $1.1166.

Metals

Metals prices tumbled as the dollar strengthened further and Treasury yields bounced-off the floor. The price of a gold ounce fell to a low of $1284 to erase almost all this week’s gains, the silver ounce dropped to a fresh 2019 low of $14.49, and palladium drifted lower towards $1321.

Oil

Oil prices raced higher supported by growing geopolitical tensions and optimism over trade talks between China and the United States. The latest developments in the Persian Gulf which followed the US sanctions on Iran are raising concerns over the security of oil carriers. On the other hand, the expectations of successful trade talks between China and the United States helped to restore investors’ risk appetite as it eased the fears of a full-blown trade war between the world’s two largest economies. The West Texas Intermediate crude futures soared to a two-week high of $63.46 and Brent futures rallied to a high of $73.33. The OPEC monitoring committee will be meeting on the weekend to discuss the latest oil market conditions ahead of the general meeting next month.

Major Economic Events

GMT Country Event Expectation Previous

9:00

EU

CPI (YoY) (Apr)

1.7%

1.7%

14:00

US

Michigan Consumer Sentiment (May) 

97.8

97.2

14:00

US

Michigan Inflation Expectations (May) 

 

2.5%

17:00

US

U.S. Baker Hughes Oil Rig Count

 

805

 

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