The dollar index (DXY) is up 0.02% today, recovering from early losses after Iran rejected a U.S. peace proposal for the ongoing conflict. Additionally, the U.S. import price index excluding petroleum rose by 1.2% month-over-month in February, marking the largest increase in four years. This could signal a hawkish stance from the Federal Reserve, with swaps markets indicating a 4% chance of a 25 basis points rate hike at the upcoming April 28-29 Federal Open Market Committee meeting.
In mortgage news, U.S. MBA mortgage applications fell by 10.5% for the week ending March 20, while the average 30-year fixed mortgage rate increased to 6.43%. The euro declined by 0.26% amid a drop in Germany’s IFO business climate index to a 13-month low of 86.4. Conversely, the yen fell by 0.6% after a downward revision of Japan’s January leading index, though market sentiment remains cautious amid ongoing geopolitical tensions.
Precious metals saw significant gains, with April gold rising by 3.54% and May silver up by 4.82%, largely influenced by a more than 4% drop in crude oil prices. This decline is viewed as dovish for central bank policies, offering safe-haven support amid fears over the continued Middle East conflict, entering its 25th day.
