The dollar index (DXY00) rose to a 1.5-week high today, up +0.22%, following stronger-than-expected US April PPI figures, which increased +1.4% month-over-month and +6.0% year-over-year, surpassing forecasts of +0.5% and +4.8%, respectively. The 10-year T-note yield reached a 10-month high of 4.49%, contributing to the dollar’s strength amidst concerns over the US-Iran ceasefire stability.
In the Eurozone, March industrial production rose by +0.2% month-over-month, falling short of expectations of +0.3%, while the French Q1 unemployment rate rose to a five-year high of 7.9%. Swaps are pricing in an 82% chance of a +25 basis point rate hike by the ECB at their next meeting. Additionally, Japan’s April Eco Watchers Outlook survey rose to 39.4, below the expected 40.9, with a 72% chance of a similar rate hike by the BOJ.
Gold prices declined by -0.09% amid a stronger dollar and expectations for Fed tightening post-PPI report, while silver saw a +2.63% increase, reaching a two-month high. Strong central bank demand for gold continued, with China’s PBOC increasing its reserves by +260,000 ounces to 74.64 million troy ounces in April.
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