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The dollar index (DXY00) increased on Friday by +0.04 %. The dollar recorded modest gains on Friday due to the high rolls of Rati, which strengthened the differences in the dollar interest rate. The dollar has declined from its best level after the Consumer September Consumer September Index is more than expected to the lowest level in 4 months. Also, on Friday, the S&P 500 is gathered to a new standard high standard, curbing the dollar.

Reducing the bullish trend in the dollar is the increasing expectations for the reduction of the federal reserve during the end of the year. The dollar is also undermined due to concerns about the independence of the federal reserve, which may push foreign investors to throw the dollar assets, as President Trump tries to shoot the governor ruled by the ruler, and through Stephen Miran to be a ruler of the Federal Reserve while he still holds his technical position in the White House in the Economic House of Economists.

The SEP consumer emotions index at the University of Michigan -2.8 decreased to the lowest level of 4 months at 55.4, i.e. weaker than 58.0 expectations.

The inflation forecast for a year at the University of Michigan has not changed from Aug, with a rate of +4.8 %, directly on the expectations. However, inflation forecast increased from 5 to 10 years unexpectedly increased to +3.9 % of +3.5 % in August, higher than a decrease to +3.4 %.

Market pricing with a 100 % chance of reducing an average -25 basis points and 6 % opportunity to reduce the average of 50 basis points in the upcoming FOMC meeting on September 16-17. After reducing an average -25 basis points -25 at the September 16-17 meeting, the markets deduct a 91 % chance to reduce the second interest rate from 25 basis points on 28-29 October. Market pricing is now at a total price -70 basis points in the average federal funds by the end of the year to 3.63 % of the current 4.33 % average.

Euro/USD (^Eurusd) increased on Friday by +0.03 %. The euro recovered from early losses on Friday and raised a little, after the outstanding comments from the European Central Bank Board of Directors and the President of the Bunnian Bank Nagil, causing short coverage in the euro when he said that reducing borrowing costs may endanger the risk of inflation by 2 % in the medium term. The central bank’s difference also supports the euro, as the markets view that the European Central Bank has ended significantly with the price scheme cycle, while the Federal Reserve is expected to reduce interest rates by three times by the end of this year.

The euro initially fell on Friday due to stronger dollars. Also, it indicates that the Russian -Ukrainian war will continue to undermine the euro after Russia said on Friday that negotiations with Ukraine are “stopping”.

The escalation of geopolitical risks in Europe is landline after Poland on Wednesday shot down drones that expressed its lands during the latest air strike by Russia on Ukraine, describing it as a “aggressive action”.

“Current interest rates are appropriate if inflation develops as expected. Therefore, unless there is any other important development, there is no need to take action soon,” said Nagel Central Bank Board member and Chairman of the Contract Bank.

“There is nothing pre -determined in advance, but it is quite possible that there is a reduction in other prices in the meetings of the upcoming European Central Bank, where many of us, including me, emphasized the risks of inflation in the near future,” said European Central Bank Board member Veldroy de Galhao.

The bares are captured at a chance of 3 % of the average -25 basis points by the European Central Bank at the Policy meeting on October 30.

USD/JPY (^USDJPY) increased on Friday by +0.22 %. Elaine was subjected to pressure on Friday after US Treasury Secretary Besin and Japanese Finance Minister Kato reaffirmed in a joint statement their primary commitment to allowing markets to determine currency exchange rates, which reduces the opportunity to interfere in the Forex markets to support the yen. Also, Friday’s rally at the Nikkei stock index fell to a new standard of demand for safe range on the yen. The losses accelerated in the yen on Friday when the T-Note yield rose.

The yen is undermined due to the political uncertainty in Japan after the Japanese Prime Minister Ishiba resigned after two results in the elections that stripped the Japanese Liberal Democratic Party from its majority in the parliament, which is seen as paving the way towards a more expansive financial policy.

Industrial production was revised in Japanese July to up to -1.2 %/m formerly reporting by -1.6 %/m.

US Treasury Secretary Bessin and Japanese Finance Minister Kato again confirmed in a joint statement their primary commitment to allowing markets to determine currency exchange rates and not targeting them to obtain a competitive advantage. They also said that the currency intervention should be intended to deal with excessive fluctuations in the non -disciplined movements in the Forex market.

Gold was closed in December (GCZ25) on Friday +12.80 (+0.35 %), and closed silver in December (Siz25) +0.681 (+1.62 %). The prices of precious metals rose on Friday, as silver published in December a high and closer contract (U25) that published the highest level in 14 years.

The precious metals climb after the American economic news showed this week that the weak labor market and the relatively existing price pressures, which strengthened the expectations of at least 25 basis points in the Federal Reserve rate at the FOMC meeting next week. Markets are also pricing in about three discounts in the Federal Reserve rate by the end of the year, which is a bullish factor for precious metals. In addition, the escalation of geopolitical risks in Europe also strengthened the safe demand for precious metals after Poland on Wednesday shot down drones that expressed its lands during the latest air strike by Russia on Ukraine, describing it as a “aggressive act.”

The purchase of gold from the Chinese Central Bank supports gold prices after PBOC has strengthened its golden purchases by +0.06 million ounces in August to 74.02 million ounces, which represents the tenth month in a row in which the central bank increased its gold reserves.

Gold prices continue to obtain support from uncertainty associated with US tariffs and geopolitical risks. Also, the political uncertainty in France and Japan leads the demand for gold as a safe origin. French Prime Minister Bayro resigned after he lost confidence in Parliament on Monday. Also, Japanese Prime Minister Ishiba resigned after two results in the elections that stripped the Japanese Liberal Democratic Party to its majority in the parliament, which is seen as paving the way towards a more expandable financial policy.

The prices of precious metals continue to obtain support from purchasing funds from precious metal investment funds. Gold bias in the investment funds circulated to the highest level of 2.25 years on Wednesday, and Silver Holdings rose in the investment funds circulating to the highest level in 3 years last Wednesday.

On the date of publication, Rich Asplund did not have positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article are only for media purposes. This article was originally published on Barchart.com