Dollar index (Dxy00) Today is below -0.59%. The dollar came under pressure today after Fed Governor Christopher Waller’s comments on Thursday evening, who said that he supports a fed interest rate cut at the July 29-30 FOMC meeting. In addition, today’s Michigan University July inflation reports were reduced to inflation expectations for fed policy and for dollars. Today, strength in shares has also curbed the demand for liquidity for the dollar.
Today’s strong-to-the–wed American housing begins on the positive side for the dollar and creates a permit report. In addition, a rapid factor for the US July Consumer Affairs Index dollar of Michigan University increased to a 5 -month high level of high level expected.
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The US June Housing grows stronger than the expectations of 1.300 million, growing from 4.6% meter/m to 1.321 million. In addition, the June building permit, a proxy for future construction increased +0.2% m/m to 1.397 million vs. -0.5% m/m decline of decline by 1.387 million.
The US July Consumer Affairs Index of the University of Michigan has stronger than the expectations of 61.8, +1.1 at a 5 -month high of 61.8.
Michigan University US July 1-Year inflation fell at a 5-month low of 4.4%, better than no changes at +5.0%. In addition, the inflation of July 5–10 years was reduced to a 5-month low of 3.6%than expectations +3.9%.
On Thursday evening, Fed Governor Christopher Waller said, “With the opposite risk for limiting inflation and inflation near the target, we should not wait until we get spoiled before the labor market is spoiled before cutting the policy rate. I believe it makes sense to cut FOMC policy rate.”
On the trade front, President Trump said late Wednesday that he intends to send a tariff letter to more than 150 countries, informing them that their tariff rate could be 10% or 15%, effective from 1 August, and these groups were not “big countries that do not do so much business with America.”
Federal Fund futures prices are offering a discount of 58% in the following meeting on July 29-30 FOMC meeting and 58% in the following meeting on 16-17 September.
EUR/USD (^Eurusd) Today is +0.47%. Fed Governor Waller said that dollar weakness is supporting profit in euro today. Today’s eurozone economic news was negative to the euro, as Eurozone May construction record its biggest decline in 2.5 years and the prices of the German June manufacturer fell at the highest speed in 9 months, the factors for the EBC policy.
The construction of eurosone has fallen output -1.7% m/m, the biggest decline in about 2.5 years.
German June PPI -1.3% y/y fell, correct on expectations and the highest speed of decline in 9 months.
In the July 24 policy meeting, the Swap is pricing at 1% likely to cut -25 BP rate cut by ECB.
USD/JPY (^Usdjpy) Today -0.08%is below. Japan’s June National CPI X-Fresh Food and Energy is growing higher than the dollar today after the fastest growth in 17 months, which is a Hawkish factor for BOJ policy. In addition, the yield of low T-Rots is rapid for the yen today.
However, the benefits in Yen are limited before the Sunday’s upper house in Japan, where the Japanese Prime Minister Ishiba’s Liberal Democratic Party (LDP) may lose its majority. For voters, Japan’s ruling Liberal Democratic Party’s promises and the promises of low taxes by the opposition have led to the concerns of fiscal decline, which is a recession for Yen.
Japan June National CPI increased +3.3% y/y, right on expectations. June National CPI X-Fresh Food and Energy increased +3.4% y/y, +3.3% y/y, stronger than expectations and the biggest growth in 17 months.
August gold (Gcq25) Today +18.50 ( +0.55%), and September silver (Siu25) above +0.342 ( +0.89%). Precious metals are increasing more today due to a weak dollar. In addition, the yield of low T-not-not-notes is rapid for precious metals today. Fed Governor Waller’s comments on Thursday evening promoted the demand for precious metals in the form of a inflation hedge, as they expressed support for cutting the fed interest rate at the July 29–30 FOMC meeting. Precious metals on Wednesday after the announcement of President Trump, the global trade was also safe from stress that he intends to send a tariff letter to more than 150 countries, informing them that their tariff rate can be 10% or 15%, effective from 1 August.
Stock strength is limiting profit in precious metals today. In addition, today’s strong-to-the—fted American houses are starting and building permit reports showed signs of economic strength that were Hawkish for Fed Policy and a slowdown for precious metals.
On the date of publication,
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