Dollar Reverses Losses following Upbeat Economic Data

USD

The Dollar Index which measures the greenback against a basket of major currencies retreated from a three-week low of 95.82 to settle higher at 96.22 on strong data. The preliminary data showed that the US economy grew at a pace of 2.6% in the fourth quarter of 2019 versus an expectation of 2.2%. The upbeat data lifted the US treasury yields as it raised the chances of further monetary policy tightening in 2019. The US 10-year Treasury yields spiked to a three-week high of 2.733%, the USDJPY soared to a ten-week high of 111.84, and the EURUSD tumbled to a low of $1.1360.

Metals

Metals prices plunged as the dollar advanced along with Treasury yields on strong economic data. The gold ounce tumbled to a two-week low of $1308, and the silver ounce declined to a low of $15.56. Meanwhile, palladium continued to hover near $1540.

Oil

Oil prices extended gains, supported by OPEC-led supply cuts and US sanctions on PDVSA. Since the United States imposed sanctions on Venezuela's state-run oil company PDVSA, oil exports dropped by almost 40% to 920 thousand barrels per day. The West Texas Intermediate crude futures rose to a high of $57.85, the highest since mid-November, and Brent futures climbed to a high of $67.11. The U.S. energy services firm Baker Hughes will report the US rig count later today.

Major Economic Events

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