Decline of the US Dollar Index: The dollar fell against most major currencies during Wednesday’s trading
and extended its losses following the release of U.S. inflation data.

Content:

Continued rise of gold

Rise of the Japanese yen

Decline of the US dollar index

Continued Rise of Gold

Gold prices rose during Thursday’s trading session, nearing the level of $2400 per ounce,
following a strong increase in the previous session, driven by weak dollar and bond yields.
This came after U.S. inflation data increased the likelihood of the Federal Reserve cutting interest rates as early as September.

Economic data showed a 0.3% increase in the Consumer Price Index in April,
after a 0.4% rise in March, which was lower than expectations that predicted a monthly price growth of 0.4%.
In contrast, retail sales stabilized last month, defying expectations that projected a 0.4% monthly increase.

Rise of the Japanese Yen

The Japanese yen rose in the Asian market on Thursday against a basket of major and minor currencies,
continuing its gains for the second consecutive day against the US dollar, reaching its highest level in ten days.
The rise of the Japanese currency is attributed to the current decline in U.S. yields.

The decrease in the yield of U.S. Treasury bonds over ten years reduces the yield differential between Japan and the United States,
making Japanese yen yields a target for investors seeking safe investments and financing deals.
This supports the rise in the Japanese yen’s exchange rate.

However, some of the yen’s current gains are tempered by the release of data
on Japan’s economic performance for the year’s first quarter.
The results were worse than market expectations,
weakening the pressure on the Bank of Japan to implement a tight monetary policy.

Decline of the US Dollar Index

The dollar fell against most major currencies during Wednesday’s trading
and extended its losses following the release of U.S. inflation data.

Government data released on Wednesday showed that the U.S. Consumer Price Index
rose by 3.4% annually in April, compared with 3.5% in March.

The core index, which excludes food and energy prices, slowed to 3.6% last month from 3.8% in March,
recording its slowest pace since April 2021.

The index rose by 0.3% in April after rising 0.4% in March,
while core consumer prices rose by 0.3% every month after rising 0.4% in the previous three months.

The annual inflation rate in the United States has significantly decreased

compared to its peak in June 2022, which was 9.1%.

Decline of the US Dollar Index

Decline of the US Dollar Index

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