- US Dollar Index clings to strong gains following today’s data.
- Wall Street pares early gains.
- Trading action is likely to turn subdues ahead of Easter weekend.
The XAU/USD pair closed the fifth straight day in the negative territory on Wednesday and edged lower in the early European session pressured by the broad USD strength to touch its lowest level of 2019 at $1271. However, with the sour market mood helping the precious metal show resilience against the greenback, the pair rebounded modestly from its lows and was last seen trading near $1276, adding around $2 on the day.
Earlier today, the disappointing PMI figures from Germany and the euro area put major European currencies under pressure and ramped up the demand for the buck. The US Dollar Index easily recovered all of the losses it suffered since last week and extended its gains in the second half of the day
Today’s data from the U.S. revealed that retail sales increased by 1.6% in March to beat the market expectation of 0.9% and the weekly jobless claims dropped to its lowest level since 1969 at 192K. As of writing, the DXY was up 0.37% on the day at 97.38.
Meanwhile, following a positive start to the day, major equity indexes in the U.S. eased into the negative territory and the 10-year T-bond yield extended its slide to erase more than 1% on the day, allowing gold to take advantage of risk-off flows.
With the trading volume thinning out ahead of the Easter holiday, the pair is unlikely to make a sharp move in either direction until next week.