The dollar index (DXY) increased by 0.38% today amid rising safe-haven demand due to the ongoing war with Iran and a 3% jump in crude oil prices, which may spur inflation and prompt the Federal Reserve to tighten monetary policy. The March S&P manufacturing PMI unexpectedly rose to 52.4, surpassing expectations of a decline to 51.5. Nonfarm productivity for Q4 remained unchanged at 1.8%, while unit labor costs were revised up to 4.4%, exceeding the forecast of 3.6%.
In the Eurozone, the March S&P manufacturing PMI rose to 51.4, contrary to expectations of a drop to 49.6, marking the fastest pace of expansion in 3.75 years. However, the composite PMI declined to a 10-month low of 50.5. Eurozone February new car registrations increased by 1.4% year-over-year to 865,000. The ECB is projecting a 71% chance of a 25 basis point rate hike during the April 30 meeting, while market expectations remain cautious regarding the Japanese yen amidst dovish economic indicators.
The April COMEX gold price fell by 0.27%, driven by a stronger dollar and rising T-note yields, compounded by inflationary pressures from oil price hikes. Precious metals are experiencing increased safe-haven demand due to geopolitical uncertainties. Gold reserves held by China’s PBOC have risen by 40,000 ounces to 74.19 million troy ounces as of January, marking the fifteenth consecutive month of increases.
