Forex News
FX option expiries for Jun 25 NY cut at 10:00 Eastern Time vi a DTCC can be found below.
EUR/USD: EUR amounts
- 1.1400 1.7b
- 1.1475 1.2b
- 1.1495 3.1b
- 1.1500 1.9b
- 1.1625 914m
- 1.1650 1.7b
- 1.1710 3b
GBP/USD: GBP amounts
- 1.3400 1.1b
USD/JPY: USD amounts
- 144.00 1b
- 144.20 1.1b
- 144.50 2.2b
- 145.00 1.2b
- 146.00 1b
- 148.00 1.9b
USD/CHF: USD amounts
- 0.8250 822m
AUD/USD: AUD amounts
- 0.6300 577m
- 0.6590 626m
USD/CAD: USD amounts
- 1.3540 650m
- 1.3785 439m
- The Indian Rupee gains further to near 85.80 against the US Dollar amid a positive market mood.
- Oil prices are likely to fall further if Israel and Iran keep to the truce.
- Fed’s Powell reiterates that the central bank needs more clarity on tariffs before reducing interest rates.
The Indian Rupee (INR) extends winning streak against the US Dollar (USD) for fourth trading day on Wednesday, posts a fresh weekly high around 85.80. The USD/INR pair slides further as the Indian currency strengthens on expectations that the Oil price could decline further, following confidence that both Israel and Iran will not violate the ceasefire agreement.
During the Asian trading session, the West Texas Intermediate (WTI) Oil price seems fragile near an almost two-week low around $64.00.
Lower Oil price bodes well for currencies from nations that rely heavily on Oil imports to fulfil their energy needs, such as the Indian Rupee.
On Tuesday, United States (US) President Donald Trump stated in a post on Truth.Social that a truce between Israel and Iran has become effective and urged them not to violate. “The ceasefire is now in effect. Please do not violate it!" Trump wrote.
Meanwhile, the Indian equity market has extended their gains on lower Oil prices and improving investors’ risk appetite amid easing geopolitical tensions in the Middle East. Nifty50 opens almost 100 points higher around 25,150, and Sensex30 jumps 0.83% above 82,400. On Tuesday, Foreign Institutional Investors (FIIs) sold equity worth Rs. 5,266.01 crores.
Indian Rupee PRICE Today
The table below shows the percentage change of Indian Rupee (INR) against listed major currencies today. Indian Rupee was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | INR | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.08% | -0.07% | 0.04% | 0.11% | -0.12% | -0.38% | -0.15% | |
| EUR | 0.08% | 0.03% | 0.13% | 0.16% | -0.08% | -0.32% | -0.13% | |
| GBP | 0.07% | -0.03% | 0.10% | 0.15% | -0.08% | -0.35% | -0.08% | |
| JPY | -0.04% | -0.13% | -0.10% | 0.00% | -0.16% | -0.40% | -0.25% | |
| CAD | -0.11% | -0.16% | -0.15% | -0.00% | -0.16% | -0.37% | -0.29% | |
| AUD | 0.12% | 0.08% | 0.08% | 0.16% | 0.16% | -0.32% | -0.14% | |
| NZD | 0.38% | 0.32% | 0.35% | 0.40% | 0.37% | 0.32% | 0.18% | |
| INR | 0.15% | 0.13% | 0.08% | 0.25% | 0.29% | 0.14% | -0.18% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Indian Rupee from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent INR (base)/USD (quote).
USD/INR weakens even as Fed Powell reiterates need to hold interest rates steady
- The further downside move in the USD/INR pair is also driven by weakness in the US Dollar as easing geopolitical tensions have forced traders to pare bullish bets in safe-haven assets. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, appears fragile near the weekly low around 98.00.
- The US currency struggles to gain ground even though Federal Reserve (Fed) Chair Jerome Powell has signaled in the semi-annual testimony before the US House Financial Services Committee on Tuesday that he will not endorse interest rate cuts in the July policy meeting.
- Powell stated the central bank needs more time to “assess the impact of still-unresolved tariff rates on inflation and growth”. He guided that the “impact of the new trade policy will be reflected in the June and July data”.
- Jerome Powell didn’t rule out the scenario that the impact of new international policies could be “one-time” on inflation. He stated that the central bank will “bring interest rates down sooner if officials find price pressures well contained”.
- Contrary to Jerome Powell’s ‘wait-and-see’ approach, Fed officials: Vice Chair Michelle Bowman, Governor Christopher Waller, and Chicago Fed President Austan Goolsbee have expressed confidence that the impact of tariffs on inflation will be limited and have warned of growing downside risks to the labor market. Fed officials Waller and Bowman also expressed the need to reduce interest rates as soon as July to avoid further cracks in the job market.
- Going forward, investors will focus on New Home Sales data for May, which will be published at 14:00 GMT. Economists expect households to have bought 0.7 million homes, slightly lower than 0.743 million in April. Investors will closely monitor the housing data as the latest studies showed that households postponed new home demand due to higher mortgage rates and uncertainty over Trump’s tariff policy.
Technical Analysis: USD/INR slides below 20-day EMA
The USD/INR pair skids below the 20-day Exponential Moving Average (EMA), which trades around 86.00, suggesting that the near-term trend has become uncertain.
The 14-day Relative Strength Index (RSI) slides vertically below 50.00 after remaining above 60.00 in past few trading days, indicating a strong bearish reversal.
Looking down, the June 12 high at 85.70 will act as key support for the major. On the upside, the June 24 high of 86.60 will be a critical hurdle for the pair.
Economic Indicator
New Home Sales (MoM)
The number of New Home Sales released by the US Census Bureau is an important measure of housing market conditions. House buyers spend money on furnishing and financing their homes so as a result the demand for goods, services and the employees is stimulated. Generally, a high reading is seen as bullish for the USD, whereas a low reading is seen as bearish.
Read more.Next release: Wed Jun 25, 2025 14:00
Frequency: Monthly
Consensus: 0.7M
Previous: 0.743M
Source: US Census Bureau
The Bank of Japan (BoJ) board member Naoki Tamura said on Wednesday that inflation rose more than expected back in May and it is difficult to predict the outlook. Tamura added that the Japanese central bank may need to act decisively if upside price risks heighten further.
Key quotes
Inflation accelerating more than I expected back in May.
The fog surrounding US tariffs is clearing somewhat.
But it is still hard to predict the outlook.
BoJ may need to act decisively if upside price risks heighten further.
Won't rule out possibility of hiking rates to address upside risks amid ongoing trade talks.
But that would require price risks to be so large that BOJ might fall behind the curve.
For now though, I don't think upside price risks warrant an imminent rate hike.
No preset idea on next rate hike timing.
It could come sooner or later depending on tariffs and their impact to the economy.
Market reaction
At the press time, the USD/JPY pair is up 0.10% on the day to trade at 145.10.
Bank of Japan FAQs
The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%.
The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance.
The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.
A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
- USD/CAD attracts some buyers as bearish Oil prices undermine the Loonie.
- A modest USD weakness keeps a lid on any meaningful gains for spot prices.
- The technical setup backs the case for a further near-term appreciating move.
The USD/CAD pair builds on the previous day's bounce from the 1.3680-1.3675 area, or the weekly low, and gains some positive traction during the Asian session on Wednesday. Spot prices climb to a fresh daily high, around the 1.3730-1.3735 region in the last hour as bearish Crude Oil prices undermine the commodity-linked Loonie, through a softer US Dollar (USD) caps gain.
From a technical perspective, this week's retracement slide from the 1.3800 neighborhood, or the monthly top, stalled on Tuesday near the 100-period Simple Moving Average (SMA) on the 4-hour chart. The subsequent move up, along with the recent breakthrough a short-term descending trend-line resistance, favors bullish traders, though mixed oscillators on hourly and daily charts warrant some caution.
Hence, any further strength is likely to confront a stiff barrier near the 1.3775 region, or the 200-period SMA on the 4-hour chart. The latter is followed by the monthly high, around the 1.3800 mark, which if conquered would set the stage for a further near-term appreciating move and lift the USD/CAD pair to the 1.3835-1.3840 zone en route to the 1.3860 region (May 29 peak) and the 1.3900 round- figure mark.
On the flip side, the 1.3700 mark could offer immediate support ahead of the 1.3680-1.3675 region (100-period SMA on the 4-hour chart). A convincing break below the latter could drag the USD/CAD pair to the descending trend-line hurdle breakpoint, now turned support, currently around the 1.3615 area. Some follow-through selling below the 1.3600 mark would shift the near-term bias in favor of bears.
USD/CAD 4-hour chart
Canadian Dollar FAQs
The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.
The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.
The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.
While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar.
Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
- USD/CNH tests the immediate support at the lower boundary of the rectangle around 168.80.
- The 14-day Relative Strength Index remains below the 50 level, indicating a prevailing bearish bias.
- The primary support appears at the nine-day EMA at 7.1781.
The USD/CNH pair halts its four-day winning streak, trading around 7.1690 during the Asian hours on Wednesday. An analysis of the daily chart indicates that the pair moves sideways within a rectangular pattern, which points to a consolidation phase.
However, the 14-day Relative Strength Index (RSI), a key momentum indicator, remains below the 50 level, suggesting a bearish momentum is in play. Additionally, the USD/CNH pair trades below the nine-day Exponential Moving Average (EMA), further suggesting weaker short-term price momentum.
On the downside, the USD/CNH pair hovers around the lower boundary of the rectangle around 168.80. A break below this level could confirm the ongoing bearish bias and put the downward pressure on the pair to retest the seven-month low at 7.1603, which was recorded on June 25.
The nine-day EMA at 7.1781 appears as the initial barrier. A successful breach above this level would improve the short-term price momentum and support the pair to explore the region around the 50-day EMA at 7.2102, followed by the rectangle’s upper boundary around 7.2150. Further resistance appears at the monthly high of 7.2240, reached on June 2.
USD/CNH: Daily Chart
Central banks FAQs
Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.
A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.
A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.
Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.
- USD/CHF slides to near 0.8035 as the US Dollar continues to decline after Israel-Iran ceasefire.
- Fed’s Powell stated that the central bank needs time to learn the impact of tariffs on inflation and growth.
- The SNB pushed interest rates to zero in the monetary policy announcement last week.
The USD/CHF pair posts a fresh over-a-decade low near 0.8034 during Asian trading hours on Wednesday. The Swiss Franc pair faces a sharp selling pressure as the US Dollar (USD) continues to underperform its peers after a ceasefire between Israel and Iran.
The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, seems vulnerable near the weekly low around 98.00.
US Dollar PRICE Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | 0.00% | 0.07% | 0.15% | -0.05% | -0.37% | -0.03% | |
| EUR | 0.02% | 0.05% | 0.10% | 0.15% | -0.06% | -0.35% | -0.01% | |
| GBP | -0.00% | -0.05% | 0.06% | 0.12% | -0.08% | -0.40% | -0.03% | |
| JPY | -0.07% | -0.10% | -0.06% | 0.01% | -0.12% | -0.42% | -0.08% | |
| CAD | -0.15% | -0.15% | -0.12% | -0.01% | -0.14% | -0.39% | -0.15% | |
| AUD | 0.05% | 0.06% | 0.08% | 0.12% | 0.14% | -0.37% | 0.05% | |
| NZD | 0.37% | 0.35% | 0.40% | 0.42% | 0.39% | 0.37% | 0.37% | |
| CHF | 0.03% | 0.00% | 0.03% | 0.08% | 0.15% | -0.05% | -0.37% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
The ceasefire agreement between Israel and Iran has diminished the safe-haven demand of the US Dollar. On Monday, the US Dollar gained sharply after the United States (US) joined Israel’s assault on Iran and destroyed three nuclear sites of Tehran.
On the monetary policy front, Federal Reserve (Fed) Chair Jerome Powell has reiterated that monetary policy adjustments are not appropriate at the current time as the labor market is still solid and the central bank needs more time to assess the impact of the tariff policy on inflation.
Meanwhile, the Swiss Franc (CHF) outperforms its peersm except antipodeans, ahead of the release of ZEW Survey - Expectations for June at 08:00 GMT. In May, the sentiment data improved significantly to -22 from -51.6 in April as the Swiss National Bank (SNB) has been lowering interest rates consistently.
In the last week's monetary policy announcement, the SNB lowered interest rates to 0%, aiming to prompt inflation. SNB Chairman Martin Schlegel left the door opened for negative interest rates. "We [SNB] are now on the verge of negative interest rate territory," Schlegel said.
Swiss Franc FAQs
The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone.
The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in.
The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF.
Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate.
As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.
- EUR/USD gains ground to near 1.1615 in Wednesday’s early European session.
- Easing Middle East tensions supports the Euro against the US Dollar.
- Fed officials support the wait-and-see approach, watching price data.
The EUR/USD pair edges higher to around 1.1615 during the early European session on Wednesday. The improved risk sentiment provides some support to the Euro (EUR) against the Greenback. Traders will take more cues from the Federal Reserve’s (Fed) Chair Jerome Powell testifies later on Wednesday.
Israel and Iran signaled that the air war between them had ended, at least for now, after US President Donald Trump publicly scolded them for violating a ceasefire he announced. The de-escalation of tensions in the Middle East could underpin riskier assets like the shared currency in the near term.
Across the pond, Federal Reserve (Fed) Chair Jerome Powell said on Tuesday that the US central bank will continue to wait and see how the economy evolves before deciding whether to reduce its key interest rate. Meanwhile, Kansas City Fed President Jeff Schmid noted early Wednesday that the Fed has time to study tariff effects on inflation before any rate decision.
Less dovish tone from the Fed officials could lift the US dollar and cap the upside for the pair. Money markets have fully priced in two Fed reductions by the end of 2025, with a first move in September far more likely than next month, though expectation of a July reduction rises from last week.
Euro FAQs
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Gold prices remained broadly unchanged in India on Wednesday, according to data compiled by FXStreet.
The price for Gold stood at 9,194.51 Indian Rupees (INR) per gram, broadly stable compared with the INR 9,185.40 it cost on Tuesday.
The price for Gold was broadly steady at INR 107,242.90 per tola from INR 107,136.70 per tola a day earlier.
| Unit measure | Gold Price in INR |
|---|---|
| 1 Gram | 9,194.51 |
| 10 Grams | 91,945.05 |
| Tola | 107,242.90 |
| Troy Ounce | 285,980.00 |
Daily digest market movers: Gold price pulls back amid weak US Dollar, falling US yields
Gold prices suffered substantial losses as the markets cheered a ceasefire between Israel and Iran. US President Donald Trump posted on his social network that "Both Israel and Iran wanted to stop the War, equally! It was my great honor to Destroy All Nuclear facilities & capabilities, and then, STOP THE WAR!"
Bullion failed to print gains despite the decline in US Treasury bond yields and the US Dollar. The US 10-year Treasury note is yielding 4.30%, falling four basis points (bps). The US Dollar Index (DXY), which tracks the performance of the Buck’s value against a basket of six peers, is also down 0.56% at 97.79.
The CB revealed that Consumer Confidence in June came at 93.0, down from 98.0 a month ago and also missed forecasts of 100. “The decline was broad-based across components, with consumers' assessments of the present situation and their expectations for the future both contributing to the deterioration,” said Stephanie Guichard, senior economist for global indicators at the Conference Board.
Further Fed speakers crossed the wires. Cleveland Fed President Beth Hammack said that she sees rates “on hold for quite some time,” even though the latest inflation readings are encouraging. New York Fed John Williams commented that tariffs will boost inflation to 3% this year and expects inflation to reach the 2% goal in 2026. Furthermore, it was added that the economy will grow at a slower pace, though it will not be tipped into a recession.
On Monday, US Flash PMIs remained in expansionary territory, suggesting that the economy remains solid. Next week, traders will be watching the release of the Institute for Supply Management (ISM) figures for June.
Money markets suggest that traders are pricing in 58 basis points of easing toward the end of the year, according to Prime Market Terminal data.
FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.
(This story was corrected on June 25 at 06:16 GMT to say, in the headline, that Gold price steadies, not rises.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
(An automation tool was used in creating this post.)
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