Dollar Weakens and Gold Falls on New Iran Proposal to End War
View original at nasdaq.comDollar Weakens and Gold Falls on New Iran Proposal to End War The dollar index (DXY00) today is down by -0.19%. The dollar fell from a 2.5-week high today and turned lower after Axios reported that Iran has offered a new proposal to reopen the Strait of Hormuz…
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President Trump plans to meet today with national security and foreign policy officials to discuss the Iran proposal.
60% confidenceLong holdings in gold ETFs fell to a 4.5-month low on March 31 after climbing to a 3.5-year high on February 27, representing bearish fund liquidation.
60% confidenceToday's +2% increase in crude oil prices is negative for the Eurozone economy and the euro as Europe imports most of its energy needs.
60% confidenceThe German April IFO business confidence index fell -1.9 to a nearly 6-year low of 84.4, weaker than consensus expectations of 85.7.
60% confidenceSwaps are discounting a 5% chance of a +25 bp rate hike by the ECB at Thursday's policy meeting.
60% confidenceThe FOMC is expected to cut interest rates by at least -25 bp in 2026, while the BOJ and ECB are expected to raise rates by at least +25 bp in 2026, creating a negative interest rate differential for the dollar.
60% confidenceJapan imports more than 90% of its energy needs, making higher crude oil prices negative for the Japanese economy and the yen.
60% confidenceThe markets are discounting a +3% chance of a 25 bp BOJ rate hike at the next meeting on Tuesday.
60% confidenceIran's plan calls for extending the ceasefire so the parties can work toward a permanent end to the war, with nuclear talks to come later, only after the US blockade of the strait is lifted.
60% confidenceRecent fund liquidation of precious metals is bearish for prices.
60% confidenceIran has given the US a new proposal to reopen the Strait of Hormuz and end the war, which includes postponing nuclear negotiations.
60% confidenceLong holdings in silver ETFs fell to an 8.25-month low last Friday after rising to a 3.5-year high on December 23.
60% confidenceBullion held in China's PBOC reserves rose by +160,000 ounces to 74.38 million troy ounces in March — the seventeenth consecutive month the PBOC has boosted its gold reserves.
60% confidenceThe Japan February leading index CI was revised upward by +0.9 to a 3.5-year high of 113.3 from the previously reported 112.4.
60% confidencePrecious metals remain supported by uncertainty over US tariffs, US political turmoil, large US deficits, and government policy uncertainty, which boost demand for precious metals as a store of value.
60% confidenceHigher crude oil prices today have increased inflation expectations, a hawkish factor for Fed policy, and positive for the dollar.
60% confidenceSwaps markets are discounting the odds at 0% for a +25 bp rate hike at the Tue-Wed FOMC meeting.
60% confidence