It’s near one-year highs against the euro and six-month highs against the yen.
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Markets have for the past seven months anticipated an imminent interest rate increase but were disappointed as every consecutive Federal Reserve Open Market Committee (FOMC) failed to deliver a concrete date.
In early European trade, London was flat, Paris added 0.4 percent and Frankfurt gained 0.5 percent. Bullion has dropped almost 10 percent from a high of $1,337.40 per ounce, hit on November 9, when Donald Trump was announced USA president-elect.
The dollar index, which tracks the U.S. currency against a basket of six major currencies, rose to 101.32, its highest since April 2003.
Although some selling began to emerge early in Thursday’s trading, a positive round of economic data along with hawkish comments from Federal Reserve Chair Janet Yellen lifted the greenback out of its temporary slump and powered DXY to new 13-year highs.
While the surge in the greenback to a five-month high against the yen provided another rally for Japan’s Nikkei, traders in other Asian markets were more uneasy, with foreign investors removing cash from emerging markets seeking better U.S. returns. The Dow has set several records since the election, while the S&P 500 and Nasdaq are close to records they set a few months ago.
The government said home construction soared by 25.5 percent in October, the biggest increase in more than two decades, while the number of Americans seeking unemployment benefits, a proxy for layoffs, fell to the lowest point since 1973.
Nearly all of the S&P 500’s gains since the presidential election have gone to financial stocks. Barring any profit-taking break due to technically overbought conditions, there is enough upside momentum in the USD/JPY market to say we are looking at the early stages of a long-term bull market because I can only see the USA raising rates and the BOJ having no reasons to raise rates.
A MARVEL: Chipmaker Marvell Technology disclosed much stronger sales than analysts expected and gave a surprising forecast for the current quarter. While the euro was up 0.2 percent at $1.0725, the dollar was 0.3 percent higher against the Japanese yen at 109.19 yen.
Gold fell $7 to $1,216.90 an ounce and silver lost 16 cents to $16.77 an ounce.
USA gold futures were down 0.3 percent at $1,213.40 per ounce. Benchmark U.S. crude futures slid 0.2% to $45.33 a barrel in electronic trading on the New York Mercantile Exchange.
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Palladium dropped 1.9 percent to $714.14 an ounce, cutting its weekly gain to 5.6 percent. Natural gas climbed 14 cents, or 5.2%, to 2.84 dollars per 1,000 cubic feet. Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.61 percent to 920.63 tonnes on Thursday. The German DAX lost 0.2 per cent. Japan’s benchmark Nikkei 225 index added 0.6 per cent as the yen hit a six-month low, helping shares of the country’s big exporters.
