The dollar index (DXY) increased by 0.22% today, supported by the June ISM services index which met expectations at 54.0. The index also found support from the weakness of the yen, as Japanese authorities refrained from intervening in the forex market while U.S. markets were closed last Friday. The swaps market is predicting a 24% chance of a +25 basis point rate hike at the next FOMC meeting on July 28-29.
In the Eurozone, May retail sales rose slightly by 0.2%, below the 0.3% expected. However, the July Sentix investor confidence index climbed to -3.1, better than the forecast of -10.0. Meanwhile, German factory orders increased by 1.9% in May, exceeding expectations of 1.1%. The market currently sees a 3% chance of a +25 basis point rate hike by the ECB at its July 23 meeting.
The yen fell by 0.60% against the dollar due to the lack of intervention from Japanese authorities, with the currency trading above 160 per dollar, marking a 39-year low. In commodities, August COMEX gold rose by $25 to $1,800.00, and September COMEX silver increased by $1.106, driven partially by reduced chances of Fed monetary tightening and rising demands from central banks, including a notable increase in China’s gold reserves.
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