The dollar index 
DXY today is up by +0.30% at a four-session high. The dollar is moving higher today on weakness in the yen, which has fallen to a one-week low against the dollar, as expectations rise that new Japanese Prime Minister Takaichi will maintain an expansionary fiscal policy. The dollar also has carryover support from Monday, when US-China trade tensions eased after President Trump said, “I think we’re going to be fine with China.”
Gains in the dollar are limited after the Oct Philadelphia Fed non-manufacturing business activity survey fell to a 4-month low. Also, the ongoing shutdown of the US government is bearish for the dollar. The longer the shutdown is maintained, the more likely the US economy will suffer, a negative factor for the dollar.
Join 200K+ Subscribers: Find out why the midday Barchart Brief newsletter is a must-read for thousands daily.
The Oct Philadelphia Fed non-manufacturing business activity survey fell -9.9 to a 4-month low of -22.2.
The markets are pricing in a 99% chance of a -25 bp rate cut at the next FOMC meeting on Oct 28-29.
EUR/USD 
S today is up by +0.60%. The yen tumbled to a one-week low against the dollar today after Sanae Takaichi won the parliamentary vote to become Prime Minister. Takaichi’s policies are unfavorable for the yen, as she advocates for increased deficit spending and expanded financial stimulus. The yen is also under pressure after the Nikkei Stock Index rose to a new record high today, which curbed safe-haven demand for the yen.
Japan’s Sep machine tool orders were revised upward to +11.0% y/y from the previously reported +9.9% y/y, the largest increase in 6 months.
December COMEX gold (GCZ25) today is down -174.90 (-4.01%), and December COMEX silver (SIZ25) is down -3.374 (-6.57%). Gold and silver prices are plunging today, with silver reaching a one-week low. Today’s stronger dollar is weighing on metals prices. Also, the easing of US-China trade tensions has sparked massive, long liquidation in precious metals after President Trump said relations with China “will be fine.”
Gold and silver prices rallied to record highs last week as they extended their two-month-long parabolic rally. Precious metals continue to receive safe-haven support due to uncertainty tied to US tariffs, geopolitical risks, central bank buying, and US-China trade tensions. Also, President Trump’s attacks on Fed independence are boosting demand for gold. In addition, recent weaker-than-expected US economic news has bolstered the outlook for the Fed to keep cutting interest rates, a bullish factor for precious metals.
Precious metals prices continue to receive support from fund buying of precious metal ETFs. Gold holdings in ETFs rose to a 3-year high on Monday, and silver holdings in ETFs rose to a 3.25-year high last Tuesday.
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes.For more information please view the Barchart Disclosure Policy here.
More news from Barchart
- Want to Know If Gold and Silver Prices Can Head Higher? Watch the $50 Level for Silver.
- Our Top Chart Strategist Explains How to Trade Gold Now as Prices Disconnect from Technicals
- Gold Price Forecast: Is the Mania Over or Is $5,000 a Realistic Target?
- 1 Options Trade to Make Now as Silver Looks Ready to Top Out
