The U.S. dollar index (DXY) rose by 0.06% on Friday, supported by a hawkish Consumer Price Index (CPI) report, which increased the likelihood of a Federal Open Market Committee (FOMC) rate hike to 88% from 75%. The August CPI showed a monthly increase of 0.4%, while the core CPI rose 0.3%, exceeding expectations of 0.2%. Year-over-year, the CPI remained steady at 3.4%, aligning with market expectations.
Oil prices fell by 2.4% on Friday, following a surge earlier in the week, and the International Energy Agency warned of a significant drop in global oil demand this year, the largest since the COVID-19 pandemic. Meanwhile, the euro fell by 0.14%, affected by oil price trends and the stronger dollar, despite the European Central Bank’s recent interest rate hike and positive GDP forecast.
The Japanese yen decreased by 0.46%, although there are strong expectations of a Bank of Japan rate hike later this month, countering pressures from rising oil prices. December gold and silver closed slightly higher on Friday despite bearish influences, supported by growing fund demand for precious metals and ongoing central bank purchases.
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