Dollar Rebounds on Powell Comments; Gold Holds, Silver Climbs (04.17.2025)

The U.S. dollar rebounded on Thursday, with the Dollar Index climbing above 99.5 as Fed Chair Powell pushed back on immediate rate cuts. 

EUR/USD steadied near 1.1370, while the yen weakened past 142 amid cautious sentiment. Gold held above $3,330 on safe-haven demand and ongoing trade tensions. The British pound eased to $1.3225 after a seven-day rally, with UK inflation softening. Silver remained firm above $32.50, as markets digested Powell’s inflation warnings and a White House review of mineral tariffs.

EUR/USD Holds Near 1.1370 as Dollar Rebounds on Fed

EUR/USD traded near 1.1370 on Thursday as the US Dollar Index rebounded above 99.5. The recovery came amid speculation over Fed policy and trade tensions. On Wednesday, Fed Chair Powell warned tariffs could raise inflation and slow growth, making rate cuts less urgent. He said the Fed would wait for clearer economic signals. Meanwhile, Beijing may be open to talks, easing some trade concerns. On the data front, US retail sales surged in March, marking the strongest monthly rise in over two years, highlighting consumer strength despite persistent uncertainty.

Key resistance is at 1.1415, followed by 1.1475 and 1.1500. Support lies at 1.1260, then 1.1180 and 1.1100.

Yen Weakens Past 142 as Powell Pushes Back on Rate Cuts

The Japanese yen weakened past 142 per dollar on Thursday as the U.S. dollar rebounded after Fed Chair Powell signaled no imminent rate cuts. He warned that tariffs could raise inflation and slow growth. Japan’s March exports missed forecasts due to weaker demand from China and the EU, though rising imports pointed to stable domestic demand. Economy Minister Ryosei Akazawa said currency issues were not on the agenda in current U.S. trade talks, where Japan continues pushing for the removal of Trump-era tariffs, including a 10% base rate and an extra 25% on auto exports.

Key resistance is at 144.20, with further levels at 148.30 and 152.50. Support stands at 141.80, followed by 141.00 and 139.65.

Gold Holds Above $3,330 on Trade Uncertainty

Gold held above $3,330 on Thursday after a 3% jump, supported by safe-haven demand amid U.S. trade policy uncertainty. The Trump administration paused tariffs on some tech goods but opened new probes into semiconductor and pharmaceutical imports, possibly leading to fresh levies. Fed Chair Jerome Powell signaled no immediate rate changes, warning tariffs could raise inflation and slow growth. Investors are also watching for progress in U.S.-China trade talks, with Beijing open to negotiations under specific conditions.

Key resistance is at $3360, followed by $3,380 and $3,400. Support stands at $3290, then $3245 and $3190.

BoE Rate Cut Bets Grow as UK Inflation Slows

The British pound rose for a seventh straight session Wednesday, hitting $1.329 before easing to $1.3225 Thursday morning, which is its longest rally since July. Gains were fueled by broad US dollar weakness, despite softer UK inflation data. Headline CPI slowed to 2.6% y/y and services inflation eased to 4.7%, reducing pressure on the BoE. Markets now price in 86 bps of rate cuts this year, with higher odds of a fourth cut in December, as easing inflation gives the BoE more room to support growth amid trade tensions and rising household costs.

If GBP/USD breaks above 1.3270, resistance levels are at 1.3430 and 1.3500. Support is at 1.3015, followed by 1.2900 and 1.2700.

Silver Gains as Tariff Review Sparks Market Caution

Silver held above $32.50 per ounce on Thursday morning, near a two-week high. Rising trade tensions and economic uncertainty continued to support safe-haven demand. President Trump ordered a review of tariffs on all critical mineral imports, many of which come from China. This fueled fears of a deeper trade conflict. In response, Beijing accused Washington of "trade bullying." Silver also benefited from a weaker U.S. dollar, as markets grew concerned about a tariff-driven slowdown. Investors are now focused on Fed Chair Jerome Powell’s speech later today for guidance on interest rates and inflation.

Resistance levels are at $32.70, $33.15, and $33.80. Support is seen at $31.40, followed by $30.20 and $29.20.