The dollar index (DXY) reached a 13-month high on Tuesday, finishing up by 0.36%. This increase was influenced by a decline in equity markets, raising liquidity demand for the dollar and bolstered by the Federal Open Market Committee’s (FOMC) projection of higher interest rates. Meanwhile, the June S&P manufacturing PMI unexpectedly rose to 55.7, surpassing expectations of 54.6.
In Europe, the euro fell to a one-year low against the dollar, down 0.42%, affected by dovish comments from ECB President Christine Lagarde, which decreased the chances of future rate hikes. The Eurozone’s June S&P manufacturing PMI decreased to 51.3, while the composite PMI increased to 49.5, indicating mixed economic signals. Conversely, new car registrations in May rose by 3.2% year-over-year, totaling 955,000 units.
In Japan, the yen saw slight gains as the June S&P manufacturing PMI improved to 54.9, with indications of a strengthening economy. Concerns persist about the Bank of Japan’s slow approach to policy normalization, with a 3% chance of a rate hike expected at the next meeting on July 31. Gold and silver prices dropped sharply, with gold closing at a 1.5-week low and silver at a three-month low due to higher dollar demand and a selloff in equity markets.
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