The dollar index fell as Trump’s policies eased inflation concerns, with no mention of China tariffs at the World Economic Forum. The euro rose to $1.05, supported by a weaker dollar, improving Eurozone PMIs, and expected ECB rate cuts. The yen strengthened as the BoJ raised rates to 0.5%, its highest in 16 years, with core inflation hitting 3% and potential further hikes ahead.
Gold climbed above $2,770, nearing its $2,790 record, driven by Trump’s rate cut calls, a weaker dollar, and tariff uncertainty. Silver rose above $30.70, supported by strong industrial demand, supply concerns, and optimism from China’s role as a key consumer.
Japan’s 10-year bond yields reached 1.22% after the BoJ’s hike, while China’s 10-year yields declined after a strong start. U.S. 10-year yields stayed flat.
Jobless claims rose by 6,000 to 223,000 for the week ending January 18, with the 4-week average increasing to 213,500. Insured unemployment hit 1,899,000, its highest since November 2021, while the insured unemployment rate stayed at 1.2%.
The Bank of Japan raised its key rate by 25bps to 0.5%, the highest in 17 years, citing wage growth and inflation progress. The BoJ upgraded its inflation forecast to 2.7% for FY 2024 and signaled possible further hikes.
The U.S. Manufacturing PMI improved to 50.1 in January, ending six months of contraction. Factory output and new orders returned to modest growth, while inventories dropped at their fastest pace in 17 months.
The Services PMI fell to 52.8 in January, marking the slowest expansion since April. Output growth weakened, but hiring hit a 30-month high, while input costs rose, reversing a 10-month decline.
The dollar index dropped 0.8% last week, breaking a six-week winning streak, as weaker inflation and retail sales raised expectations for Fed rate cuts. Trump softened his stance on tariffs, reducing inflation fears.
The euro rose near $1.05, supported by a weaker dollar and stronger Eurozone PMI data. The ECB is expected to cut rates by 25bps next week while signaling further easing in 2024.
The pound climbed to $1.24 after better-than-expected U.K. PMI data. However, falling new orders and rising costs raise concerns. The BoE is likely to cut rates by 25bps in February.
The yen strengthened after the BoJ raised rates to 0.5%, the highest in 16 years. Japan's core inflation rose to 3%, supporting further tightening while manufacturing contracted for a seventh month.
Gold rose above $2,770 per ounce, its highest since October, driven by a weaker dollar and Trump's call for lower interest rates. Safe-haven demand persists amid tariff uncertainty and global central bank policy decisions.
Silver climbed to $30.70 per ounce, supported by Fed rate cut expectations, weaker dollar, and strong industrial demand. Supply concerns and China's role as a major consumer added to bullish sentiment.
U.S. indices closed the week higher, benefiting from the weakness in the dollar index, marking a second consecutive week of gains. Leading the rally were stocks such as Netflix, Amazon, Meta, and Google, while Apple and Tesla stood out on the downside.
Defense Spending Exempt: Germany Alters Debt RulesGermany has reached a new agreement allowing defense spending to be exempt from the country's strict debt rules, known as the "debt brake," under specific conditions.
Detail Markets Eye Trade Tensions, Inflation as Gold Hits Record (03.14.2025)Markets remain volatile as trade tensions and inflation concerns dominate sentiment.
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PPI Unchanged in February, Annual Inflation at 3.2%The Producer Price Index (PPI) for final demand remained unchanged in February, seasonally adjusted, according to the U.S. Bureau of Labor Statistics.
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