US retail sales grow slowly in October
US retail sales slowed down last month but were still higher than expected, indicating a cooldown in household consumption.
Official data showed US retail sales rose 0.4% m/m to $718.9 billion in October, slowing down from 0.8% in September.
On a yearly basis, US retail sales rose 2.8% last month, same as the 2023 period.
Core sales rose 0.1% m/m in October, compared to a 1% rise in September.
US dollar on track for fresh weekly profit on Trump trade
The US dollar fell in European trade on Friday for the first session in six, moving away from one-year highs on profit-taking.
Nonetheless, the dollar is heading for a new weekly profit amid strong momentum following Donald Trump’s US election victory.
Recent bullish remarks by Fed Chair Jerome Powell also dampened the odds of another 0.25% US interest rate cut in December.
The Price
The dollar index fell 0.45% today to 106.44, with a session-high at 106.96.
On Thursday, the index rose 0.4%, the fifth profit in a row, scaling a year high at 107.06.
Weekly Trading
The dollar index is up 1.5% so far this week, on track for the second weekly profit in a row.
Trump Trade
Since Trump’s landslide election victory last week, global markets have experienced a wave of rapid changes and movements called “Trump trade” amid massive optimism about Trump’s upcoming economic policies.
Trump’s policies on raising tariffs and constraining immigration are expected to raise inflationary pressures in the long term.
Such measures will likely raise the costs of imports and increase wages and boost inflation, which might force the Federal Reserve to reconsider the pace of policy easing.
US Rates
Fed Chair Jerome Powell said on Thursday that there’s no need to accelerate interest rate cuts as the economy and the labor market continue to grow, and inflation remains above 2%.
According to the Fedwatch tool, the odds of a 0.25% Fed rate cut in December tumbled from 83% to 59%.
Now investors await important US retail sales data later today in addition to speeches by some Fed officials, which could provide clues on the future path of monetary policies.
Gold about to mark its biggest weekly loss in three years
Gold prices edged up in European trade on Friday for the first time in six days away from two-month lows.
Despite the gains, gold prices are still heading for the biggest weekly loss in three years as both the dollar and US treasury yields surged.
Recent bullish remarks by Fed Chair Jerome Powell also dampened the odds of another 0.25% US interest rate cut in December.
The Price
Gold prices rose 0.3% today to $2571 an ounce, with a session-low at $2554.
On Thursday, gold lost 0.3%, the fifth loss in a row, plumbing two-month lows at $2536 under pressure from the stronger dollar.
Weekly Trades
Across the week, gold prices are down 4.25% so far, about to mark the heftiest weekly loss since June 2021.
The Dollar
The dollar index rallied to a year high on Thursday at 107.06 against a basket of major rivals.
A stronger dollar makes greenback-denominated gold futures cheaper to holders of other currencies.
Markets are expecting expansionary and inflationary policies by US President-elect Donald Trump, which would likely keep monetary policies constrictive and the dollar stronger.
US Yields
US 10-year treasury yields rose 0.7% on Friday to near 4-⅕ month highs at 4.483%, pressuring non-yielding assets.
Trump Trade
Since Trump’s landslide election victory last week, global markets have experienced a wave of rapid changes and movements called “Trump trade” amid massive optimism about Trump’s upcoming economic policies.
Trump’s policies on raising tariffs and constraining immigration are expected to raise inflationary pressures in the long term.
Such measures will likely raise the costs of imports and increase wages and boost inflation, which might force the Federal Reserve to reconsider the pace of policy easing.
US Rates
Fed Chair Jerome Powell said on Thursday that there’s no need to accelerate interest rate cuts as the economy and the labor market continue to grow, and inflation remains above 2%.
According to the Fedwatch tool, the odds of a 0.25% Fed rate cut in December tumbled from 83% to 59%.
Now investors await important US retail sales data later today in addition to speeches by some Fed officials, which could provide clues on the future path of monetary policies.
SPDR
Gold holdings at the SPDR Gold Trust fell 1.15 tons yesterday to a total of 867.37 tons, a September 11 low.