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Gold is trading $18 higher early in Asian trading to $3366. It rose as high as $3370 to briefly top the Asian peak from yesterday in a sign of solid demand.

Earlier this week, gold hit a record high above $3500 but that led to a powerful round of profit taking into Wednesday’s trading in the US. That’s since stabilized and the US dollar was soft again earlier in US trade. Now we’re seeing fresh signs of Asian demand.

Some levels

The first line to watch is whether gold can hold above yesterday’s Asian high of $3367 and then I will be eyeing the 50% retracement level at $3380, followed by the all-important $61.8% level at $3409. That would be a big hill to climb before the weekly close and imply a further $42 rally from here.

If that were to happen, it would be a powerful dip-buying signal and sign of a strong appetite from real money gold buyers.

This article was written by Adam Button at www.forexlive.com.

• Instructed cabinet members to do the utmost to aid SME’s that will be affected

He’s talking about domestic help here, not counter-tariffs.

This article was written by Adam Button at www.forexlive.com.

• To closely review Alaska LNG project

I’m not really sure what ‘common ground’ means in this case. I find the idea of the US rebuilding its ship building capacity to be really difficult to get my head around as it would take years just to assemble the workforce and there is no scope where US-built ships are competitive on the world stage.

As for the Alaska LNG project, I just don’t see the economics working when it’s all much easier to do elsewhere.

This article was written by Adam Button at www.forexlive.com.

• Kato told Bessent that US tariffs are deeply regretful
• The US and Japan to communicate closely on FX

The disappointment in Monday markets was due to reports that Japanese officials had left Washington confused and wondering what the US wanted in a trade deal. At the same time, the US seemed to pivot towards India as the top priority.

The meeting today showed that they’re trying to get something between the US and Japan on track.

This article was written by Adam Button at www.forexlive.com.

Cross-asset correlations have broken down this year.

The old risk-on/risk-off trade has been dead for awhile as the market sorts through the implications of the US trade war. That’s often been replaced by a Buy America/Sell America dynamic where we see US stocks, bonds and the dollar move in tandem.

Today there were strong binds in equities (S&P 500 up 2.2%) and bonds (US 10-year yields down 7 bps) but the dollar softened across the board. The dollar selling is a reversal of its positive momentum on Tues-Wed and may have been helped along by comments from the Fed’s Waller (though it’s not a new position for him).

At the same time, this week’s initial jobless claims report continued to show stability and a low level of layoffs.

On the trade front, there is mixed reporting on whether Washington and Beijing are talking as Chinese top officials said unquivocally that no talks are happening but US officials said the opposite. There is also hope for some kind of US-India MOU on trade, though I wouldn’t expect much for details.

On net, I see the drop in the dollar today as a sign of continued doubt in the process and strategy but we may be into a new phase where the market is more selective and believes that Trump won’t do anything too crazy to hurt equities or the economy. In that scenario you would get a sluggish US economy but it wouldn’t be severely impaired and the Fed would eventually have cover to cut rates.

This article was written by Adam Button at www.forexlive.com.

• Major US stock indices close higher with the S&P and NASDAQ both up over 2%
• Crude oil futures settled $62.79
• ECBs Knot: Medium term impact of tariffs on inflation unclear
• Pres. Trump: Will meet with world leaders in Rome
• Canadian finance minister Champagne:G7 are united, but tensions remain around tariffs
• US treasury sells 44 billion of seven year notes at a high yield of 4.123%
• Pres. Trump: There was a meeting this morning with China
• Canada PM Carney: We decide what happens here
• ECBs Rehn: Tariffs have dampening effect on inflation in short-term to medium-term
• Atlanta GDPNow growth estimate adjusted for exports and imports of gold -0.4% vs -0.1%
• European indices close mostly higher
• BOE’s Bailey: we see impact of tariff uncertainty coming through to Business/Consumer
• Kansas City Fed manufacturing index for April -5 versus 1 last month
• Tech stocks lead the charge: Strong gains across sectors highlight market optimism
• ECB’s Holzmann: Rate cut must wait for more tariff certainty:
• Fed Waller: General tone is many companies are frozen by tariff uncertainty
• US existing sales for March 4.02M vs 4.13M estimate
• FoxBusiness Gasparino: Near agreement in principal on trade with India
• Cleveland Fed Hammock: Uncertainty is weighing on businesses. Influences planning
• US March advanced durable goods orders 9.2% versus 2.0% estimate.
• US initial jobless claims 222K vs 222K expected
• IMFs Georgieva: World economy is facing a new major test
• ECBs Nagel: We are fairly certain inflation effect of tariffs will be stronger in US v EU
• ECB’s Lane: Disinflationary forces are there because of the Euro and energy
• Forexlive European FX news wrap: China wants US to drop tariffs, markets still positive

The US dollar is closing lower on the day. A snapshot of the dollars declines versus the major currencies shows:

• EUR -0.68%
• JPY -0.56%
• GBP -0.64%
• CHF -0.47%
• CAD -0.24%
• AUD -0.79%
• NZD -0.86%

Although the dollar move lower, it wasn’t a sell America day. In fact, stocks gain for the third consecutive day, and yields moved solidly lower (bond prices moved sharply higher).

Looking at the closing levels of the major US stock indices, they are closing with solid gains for the third consecutive day (after Monday’s sharp selloff). For the week, the major indices are higher going into the last trading day of the week:

• Dow industrial average rose 486.83 points or 1.23% at 40093.40. For the week the index is up 2.43%.
• S&P index rose 108.91 points or 2.03% at 5484.77. For the week the index is up 3.83%.
• NASDAQ index rose 457.99 points or 2.74% at 17166.04. For the week the index is up 5.40%.

Both the S&P and the Dow industrial average are closing above their 200 hour moving averages for the first time since February. Staying above those moving averages would give the buyers some added confidence from a technical perspective.

• For the S&P, the 200-hour moving average comes in at 5459.83. The price is closing at 5484.77
• For the NASDAQ index, its 200-hour moving average comes in at 16977.02. The price is closing at 17166.04.

Looking at the US debt market, yields are sharply lower with the:

• 2-year yield at 3.788%, -7.2 basis points
• 5-year yield 3.927%, -9.0 basis points
• 10 year yield 4.307%, -8.0 basis points
• 30 year yield 4.764%, -6.7 basis points

Today, Cleveland Fed President Beth Hammack, in an interview with CNBC, highlighted that uncertainty is weighing on business sentiment and affecting decisions on spending and hiring. She emphasized the wide range of potential economic outcomes, saying the Fed currently has no clear base case and is instead assessing multiple scenarios. Hammack stressed a patient, data-driven approach to monetary policy, noting that while hard data shows resilience, soft data remains more concerning. She reaffirmed the Fed’s readiness to act quickly if needed, but only once there’s clarity on the direction of the economy.

She stated that the Fed closely monitors real data and the impact of market movements on the broader economy. Despite recent volatility, markets remain functional. Hammack also noted a lingering effect from the pandemic where businesses are hesitant to lay off workers, which may be contributing to labor market strength. While the Fed could potentially move in June, that decision hinges on whether incoming data clearly indicates the economy’s trajectory.

On policy independence, Hammack reiterated that the Fed’s focus is on managing the economy—not the markets—and emphasized that independent central banks tend to yield better outcomes, a fact recognized by market participants. She also mentioned the recent “Sell America” trend may be more of a market rebalancing than a fundamental shift.

Feds Waller also spoke. A summary of his comments showed:

• Tariff Uncertainty: Companies are largely in a holding pattern due to uncertainty over tariffs, with many firms delaying decisions.

• Employment Risks: Waller warns that payroll cuts may be the easiest way for businesses to absorb tariff costs. More layoffs and rising unemployment are possible.

• Timing and Impact: The full economic impact of tariffs likely won’t be clear by July. The second half of the year will provide more clarity.

• Inflation View: Despite uneven inflation progress over the last 18 months, he sees tariff-driven inflation as a one-time price level increase. Believes demand slowdown could mitigate inflation.

• Policy Stance on Tariffs: Tariffs should not be off the table in broader fiscal discussions; it will take courage to treat price pressures from tariffs as transitory.

• Monetary Policy Approach:

  • Rate cuts could be appropriate if unemployment rises.

  • Emphasizes a data-dependent approach, though acknowledges the risk of being late to act.

  • Willing to look through tariff-induced inflation in favor of maintaining focus on longer-term goals.

• Independence & Politics: Reiterates the Fed’s independence. Says he tries to ignore political noise and stay mission-focused, even if the President comments on Fed policy.

Waller’s tone leans slightly dovish overall, given:

• Openness to rate cuts in response to rising unemployment,

• Willingness to look through tariff-related price increases,

• Focus on economic resilience over reacting to short-term price shocks.

However, he also maintains a cautious and data-driven stance, with concern about being too late on policy responses. The emphasis on watching unemployment and dismissing politically motivated pressure reinforces a balanced but inflation-tolerant posture—for now.

In other central bank commentary

• ECB’s Holzmann maintains a dovish policy bias but with caution. While there is broad consensus toward rate cuts and the overall direction is downward, he emphasizes the need for more clarity on tariffs before acting. Further cuts are possible this year, but uncertainties around countermeasures and marginal disagreements within the ECB suggest a measured, data-dependent approach
• ECB’s Joachim Nagel highlighted regional differences in the impact of tariffs, stating that inflationary effects are expected to be stronger in the U.S. than in the eurozone. However, he warned that while Europe may see a more muted inflation response, the economic growth impact—particularly in Germany—could be significant. His comments suggest concern over the potential drag tariffs could place on already fragile euro area growth.
• ECBs Rehn offered a more nuanced view, saying that tariffs may actually have a dampening effect on inflation in the short to medium term. He added that any meaningful support from fiscal spending won’t materialize until 2026, implying that near-term inflation and growth dynamics will be largely driven by external shocks and trade policy rather than domestic stimulus.
• ECBsKnot took a more cautious stance, noting that the medium-term effects of tariffs on inflation remain uncertain. He emphasized that it is still too early to decide whether the ECB should proceed with a rate cut in June or hold steady, underscoring the central bank’s data-dependent approach amid evolving global trade tensions.

On the economic front, U.S. durable goods orders surged 9.2% in March, far exceeding the 2.0% estimate and marking the strongest monthly gain since July 2024, when orders rose 9.8%. The previous month’s figure was revised slightly lower from 1.0% to 0.9%. The sharp increase was largely driven by transportation orders, as the “ex-transportation” component came in flat at 0.0%, missing expectations of a 0.3% rise and down from the prior month’s 0.7% gain.

Nondefense capital goods orders excluding aircraft—a key proxy for business investment—edged up just 0.1%, falling short of the expected 0.2%, though an improvement from the prior month’s -0.3% (revised from -0.2%). Meanwhile, durable goods orders excluding defense jumped 10.4%, a sharp contrast to the expected 0.8% monthly gain, highlighting a major boost in civilian demand.

U.S. initial jobless claims came in at 222,000 for the week, exactly matching expectations. The prior week’s figure was revised slightly higher from 215,000 to 216,000. Continuing claims also improved, falling to 1.841 million, below the expected 1.875 million and down from a revised 1.878 million the previous week. The data suggests continued strength in the labor market, with no signs of emerging weakness. The decline in continuing claims, often viewed as a gauge of longer-term unemployment, reinforces the view that job market conditions remain stable.

In geopolitical news, Pres. Trump was pushing toward peace between Ukraine and Russia with hope sent Ukraine would cede Cremia to Russia as a way toward peace sooner rather than later. Ukraine Pres. Zelenskyy has not been in agreement.

In trade talk, there were rumblings that the US and China were speaking and agreement between India was near. However the expectations are there may be memorandums of understanding, but the thorny issues would still need to be ironed out between the US and the other country.

The comments that the US and China had spoken gave the stock market a bit of a boost but gains were already solid at the time..

This article was written by Greg Michalowski at www.forexlive.com.

Eamonn is off today because it’s a holiday in Australia and New Zealand so I’ll be sitting in for Asian trade.

The main data highlight comes at 0030 GMT (8:30 am in Tokyo) with the release of April Tokyo CPI for April. Excluding fresh food, it’s expected to rise to 3.2% y/y, which should provide some cover for a further BOJ hike but at the moment the market is pricing in just 15 bps in hikes through year end.

The other event to watch is at the top of the hour (5 pm ET) when the Fed’s Kashkari will speak. We’ve heard from him already this week so it’s highly unlikely to be market moving.

What I’ll be primarily watching for is whether Asia sells the US dollar and buys gold today. In US trading we saw a drop in yields but the dollar was sold anyway.

For more, see the economic calendar.

This article was written by Adam Button at www.forexlive.com.

The major US stock indices are closing with solid gains for the third day in row. The S&P index and NASDAQ indices both closed up over 2% with the NASDAQ index up 2.74%.

The final numbers are showing:

• Dow industrial average rose 4 and 86.83 points or 1.23% at 40,091.40
• S&P index rose 108.93 up 2.03% at 5484.79
• NASDAQ index rose 457.99 points or 2.74% at 17166.04

After the close, of that announced earnings per share of $2.81 versus $2.01 estimates on revenues of $90.23 billion versus $89.2 billion estimate. After that announced a 5% increase in its dividend. Shares are trading up 5.12% in after-hours trading.

Meanwhile, Intel announced better than expected earnings at $0.13 versus $0.00 estimate. Revenues were also better at $12.7 billion versus $12.2 billion. However, guidance was lower than expected and its shares are currently trading down -3.82% a $20.67.

This article was written by Greg Michalowski at www.forexlive.com.

Crude oil futures settled at $62.79 on the day, gaining $0.52 or 0.84%. The modest rise reflects a market still searching for direction, as traders weigh near-term supply dynamics and broader macroeconomic uncertainty.

From a technical perspective, the hourly chart shows crude largely trading between its key moving averages. The 100-hour moving average currently sits at $63.04, acting as resistance, while the 200-hour moving average at $62.20 provides support. While the price did briefly extend beyond both of those levels—reaching a high of $63.27 and a low of $62.01—it has since pulled back into that range.

This consolidation suggests the market is in a state of indecision, awaiting a catalyst to drive a more sustained breakout. For now, the 100- and 200-hour moving averages remain the critical markers. A move above the 100-hour MA would open the door for further upside momentum, while a break below the 200-hour MA could signal a deeper correction. Until then, crude remains range-bound, with traders watching for the next directional shove.

This article was written by Greg Michalowski at www.forexlive.com.

Pres. Trump is speaking in the White House and says:

• Think will be very difficult to get Crimea back
• Both Russia and Ukraine one peace now
• Don’t think Russia is an obstacle to peace
• We are using a lot of pressure on both countries
• Russia has offered to stop the war, and stopped taking the whole country.
• Norway is going to help us and the war
• Will be meeting with world leaders in Rome (will be attending the funeral of Pope Francis)
• Doing very well with respect to Iran.
• Energy prices influence Russia on war talks.
• The Fed is late. Hope the Fed lowers interest rates
• Either countries negotiated deal or they set a deal, some will be tariffed at some point, will set prices for deals

This article was written by Greg Michalowski at www.forexlive.com.

The Canadian finance minister Champagne is speaking and says:

• G7 are united but tensions remain around tariffs.
• Canadian leadership is needed to maintain unity of G7
• We need to fight against the US tariffs which are still affecting a large portion of Canadian goods.
• In an uncertain world, fundamentals of Canada offer confidence for future
• Scheduling was too tight for bilateral meeting with US Treasury Secretary Bessent
• Interacted with Bessent at G7 meeting in Washington
• Tariffs will have inflationary impact, affect global growth

This article was written by Greg Michalowski at www.forexlive.com.

• High yield 4.123%
• WI level at the time of the auction 4.121%
• Tail versus six-month averages 0.2 basis points versus six-month average of -1.1 basis points
• Bid to Cover 2.55X vs six-month average of 2.67X
• Directs (domestic buyers) 25.44% vs six-month average of 20.6%
• Indirects (internations buyers) 59.3% versus six-month average of 69.7%
• Dealer 15.3% vs six-month average of 9.7%

Auction Grade: D+

The seven year note auction continued the trend where domestic buyers were stronger than international buyers. In this case the dip in the international buyers more than offset the rise in the domestic buyers. That led to a positive tail of 0.2 basis points in a bid to cover which was less than the six-month average.

As a result, I’ve given the auction grade a D+. It’s definitely below average, and more so than C- grade. It’s not a disaster but it’s below average

This article was written by Greg Michalowski at www.forexlive.com.