The dollar index (DXY) declined by 0.41% to a one-week low following a tentative ceasefire announcement between Israel and Iran, which decreased safe-haven demand for the dollar. Additionally, an unexpected drop in the Conference Board’s June consumer confidence index to 93.0 (a decrease of 5.4 from the previous month) contributed to dollar weaknesses. In contrast, positive remarks from Fed Chair Powell and Atlanta Fed President Bostic indicated no urgency to cut interest rates, providing some moderate support to the dollar.
On the housing front, the US April S&P CoreLogic composite-20 home price index rose 3.42% year-over-year, below the expected 3.90%, marking the smallest annual increase in nearly two years. Additionally, the German IFO business climate index improved to a 13-month high of 88.4, exceeding expectations of 88.0, further strengthening the euro which rose 0.33% against the dollar.
In precious metals, August gold fell 2.21% to a two-week low due to easing geopolitical risks and hawkish Fed comments, despite a dip in the dollar. Conversely, ETF holdings for gold increased, reaching a 1.75-year high. Meanwhile, crude prices dropped over 3%, supporting the Japanese yen as USD/JPY also decreased by 0.99%.
