The U.S. dollar index (DXY00) fell by 0.32% following comments from Federal Reserve Chair Jerome Powell regarding a potential criminal indictment from the Justice Department related to his June testimony on Fed renovations. Powell stated that the threat originated from the Fed’s independence in setting interest rates, highlighting pressures from the Trump administration.
In January, the Eurozone’s Sentix investor confidence index rose by 4.4 points to -1.8, exceeding expectations of -5.0. The markets are currently assigning a 5% chance of a 25 basis point rate cut by the FOMC on January 27-28, while the Bank of Japan is not expected to raise rates in their upcoming meeting on January 23.
Gold prices surged, with February COMEX gold rising by $124.90 to a contract high, supported by increased demand for safe havens amid uncertainties regarding U.S. monetary policy and geopolitical tensions. Precious metals are benefiting from strong central bank purchases and increased liquidity in the financial system.
