{"id":22365,"date":"2025-09-29T21:03:00","date_gmt":"2025-09-30T01:03:00","guid":{"rendered":"https:\/\/sharewatch.com\/wp\/2025\/09\/29\/dollar-falls-and-gold-rallies-to-a-record-high-on-fed-easing-prospects\/"},"modified":"2025-09-29T21:03:00","modified_gmt":"2025-09-30T01:03:00","slug":"dollar-falls-and-gold-rallies-to-a-record-high-on-fed-easing-prospects","status":"publish","type":"post","link":"https:\/\/sharewatch.com\/wp\/2025\/09\/29\/dollar-falls-and-gold-rallies-to-a-record-high-on-fed-easing-prospects\/","title":{"rendered":"Dollar Falls and Gold Rallies to a Record High on Fed Easing Prospects"},"content":{"rendered":"<div class=\"layout__region nsdq-l-grid__item syndicated-article-body\">\n<section class=\"jupiter22-c-article-body\">\n<div class=\"body\">\n<div class=\"body__content\">\n<p>The dollar index (DXY00) on Monday fell by -0.22%.\u00a0 The dollar moved lower on Monday due to speculation that weak US labormarket newsthis week, including the August JOLTS job openings, the September ADP employment change, and the September nonfarm payrolls, will prompt the Fed to continue cutting interest rates. \u00a0Also, the looming risk of a US government shutdown on Wednesday is weighing on market sentiment toward the dollar.\u00a0 The dollar recovered from its worst level after Aug pending home sales rose more than expected by the most in 5 months.<\/p>\n<p>US Aug pending home sales rose +4.0% m\/m, stronger than expectations of +0.4% m\/m and the biggest increase in 5 months.<\/p>\n<div class=\"ads__inline\">\n<div id=\"js-dfp-tag-uts\"  class=\"btf-bodymidpagetwothirdswidth-1\">          <script type=\"text\/javascript\">         googletag.cmd.push(function() {             \/\/ Check if ID matches ID in the window.adsList array before calling googletag.display             function isAdInAdsList(id) {             for (var i = 0; i < window.adsList.length; i++) {                 if (window.adsList[i].id === id) {                     return true;                 }             }             return false;         }         if (isAdInAdsList('js-dfp-tag-uts')) {             googletag.display('js-dfp-tag-uts');         }         });     <\/script> <\/div>\n<\/p><\/div>\n<p>     <span>Join 200K+ Subscribers: <\/span> Find out why the midday Barchart Brief newsletter is a must-read for thousands daily.  <\/p>\n<p>\u00a0<\/p>\n<p>The US Sep Dallas Fed manufacturing activity survey unexpectedly fell -6.9 to -8.7, weaker than expectations of an increase to -1.0.<\/p>\n<p>Fed comments on Monday were mixed for the dollar.\u00a0 On the bearish side, New York Fed President John Williams said that inflation risks have receded, while those for employment have increased, making it sensible for the Fed to lower interest rates. \u00a0Conversely, Cleveland Fed President Beth Hammack said that inflation \"is not really getting back down to the Fed's objective of 2% until the end of 2027 or early 2028\" and that \"we really need to maintain a restrictive stance for policy.\"<\/p>\n<p>The markets are pricing in an 89% chance of a -25 bp rate cut at the next FOMC meeting on Oct 28-29.<\/p>\n<p>EUR\/USD (^EURUSD) on Monday rose by +0.23%. \u00a0The euro moved higher on Monday due to a weaker dollar.\u00a0Also, Monday's economic news was supportive of the euro after the Eurozone's Sep economic confidence index rose more than expected.\u00a0 In addition, hawkish comments on Monday from ECB Governing Council member Makhlouf were bullish for the euro, as he stated that the ECB is \"near the bottom\" of its rate-cutting cycle.\u00a0<\/p>\n<div class=\"ads__inline\">\n<div id=\"js-dfp-tag-tBE\"  class=\"btf-bodymidpagetwothirdswidth-2\">          <script type=\"text\/javascript\">         googletag.cmd.push(function() {             \/\/ Check if ID matches ID in the window.adsList array before calling googletag.display             function isAdInAdsList(id) {             for (var i = 0; i < window.adsList.length; i++) {                 if (window.adsList[i].id === id) {                     return true;                 }             }             return false;         }         if (isAdInAdsList('js-dfp-tag-tBE')) {             googletag.display('js-dfp-tag-tBE');         }         });     <\/script> <\/div>\n<\/p><\/div>\n<p>The euro also has support from central bank divergence, as the markets view the ECB as largely finished with its rate-cut cycle, while the Fed is expected to cut rates by roughly two more times by the end of this year.<\/p>\n<p>Eurozone Sep economic confidence unexpectedly rose +0.2 to 95.5, stronger than expectations of 95.3.\u00a0<\/p>\n<p>ECB Governing Council member Makhlouf said the ECB is \"near the bottom\" of its rate-cutting cycle and policymakers need to remain vigilant because the full impact of US tariffs \"is still to feed through\" to European Union imports.<\/p>\n<p>Swaps are pricing in a 2% chance of a -25 bp rate cut by the ECB at the October 30 policy meeting.<\/p>\n<p>USD\/JPY (^USDJPY) on Monday fell by -0.60%. \u00a0Monday's weaker dollar and lower T-note yields were supportive of the yen.\u00a0 Also, Monday's upward revision to the Japan Jul leading index CI to a 4-month high is bullish for the yen.\u00a0 In addition, hawkish comments from BOJ board member and noted dove Noguchi pushed the yen higher when he noted the need for a BOJ interest rate hike.<\/p>\n<div class=\"ads__inline\">\n<div id=\"js-dfp-tag-AJI\"  class=\"btf-bodymidpagetwothirdswidth-3\">          <script type=\"text\/javascript\">         googletag.cmd.push(function() {             \/\/ Check if ID matches ID in the window.adsList array before calling googletag.display             function isAdInAdsList(id) {             for (var i = 0; i < window.adsList.length; i++) {                 if (window.adsList[i].id === id) {                     return true;                 }             }             return false;         }         if (isAdInAdsList('js-dfp-tag-AJI')) {             googletag.display('js-dfp-tag-AJI');         }         });     <\/script> <\/div>\n<\/p><\/div>\n<p>The Japan Jul leading index CI was revised upward to a 4-month high of 106.1 from the previously reported 105.9.<\/p>\n<p>BOJ board member and noted dove Noguchi said, \"Various economic indicators for Japan show steady progress in achieving the 2% price stability target.\u00a0 This suggests that the need to adjust the policy interest rate is increasing more than ever.\"<\/p>\n<p>December gold (GCZ25) on Monday closed up +46.20 (+1.21%), and December silver (SIZ25) closed up +0.360 (+0.77%).\u00a0 Precious metal prices rallied on Monday, with Dec gold posting a contract high and nearest future (V25) posting a record high of $3,827.60 a troy ounce.\u00a0 Also, Dec silver posted a contract high, and nearest-futures (U25) posted a 14-year high.\u00a0<\/p>\n<p>Precious metals moved higher on Monday due to a weaker dollar and lower global bond yields.\u00a0 Precious metals continue to receive safe-haven support due to uncertainty tied to US tariffs, a possible US government shutdown this week, and the outlook for the Fed to cut interest rates by another 50 bp this year.\u00a0 Also, President Trump's attacks on Fed independence are boosting demand for gold, as he attempts to fire Fed Governor Cook.\u00a0 Additionally, Stephen Miran's intention to be a Fed Governor while still technically holding his White House job on the Council of Economic Advisors contributes to this uncertainty.\u00a0 Finally, geopolitical risks and global trade tensions have boosted safe-haven demand for precious metals.\u00a0<\/p>\n<p>Monday's Fed comments were mixed for precious metals.\u00a0 On the bullish side, New York Fed President John Williams said inflation risks have receded, while those for employment have moved up, making it sensible for the Fed to lower interest rates.\u00a0 Conversely, Cleveland Fed President Beth Hammack said she favored \"mildly restrictive\" Fed policy, citing concern that inflation could stay above the Fed's 2% target until 2028.\u00a0<\/p>\n<div class=\"ads__inline\">\n<div id=\"js-dfp-tag-_Sc\"  class=\"btf-bodymidpagetwothirdswidth-4\">          <script type=\"text\/javascript\">         googletag.cmd.push(function() {             \/\/ Check if ID matches ID in the window.adsList array before calling googletag.display             function isAdInAdsList(id) {             for (var i = 0; i < window.adsList.length; i++) {                 if (window.adsList[i].id === id) {                     return true;                 }             }             return false;         }         if (isAdInAdsList('js-dfp-tag-_Sc')) {             googletag.display('js-dfp-tag-_Sc');         }         });     <\/script> <\/div>\n<\/p><\/div>\n<p>Precious metals prices continue to receive support from fund buying of precious metal ETFs.\u00a0 Gold holdings in ETFs rose to a nearly 3-year high last Friday, and silver holdings in ETFs rose to a 3-year high last Wednesday.<\/p>\n<p><i>     On the date of publication,      Rich Asplund              did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes.          For more information please view the Barchart Disclosure Policy      here. <\/i><\/p>\n<p>\u00a0<\/p>\n<p> More news from Barchart <\/p>\n<ul>\n<li>7 Clues to Watch for Signs Gold and Silver Prices Are Running Out of Gas<\/li>\n<li>Gold Just Hit Its Most Overbought Level in 45 Years According to This Chart<\/li>\n<li>How Gold, Grains, the U.S. Dollar, and Other Futures Markets Could React to the Fed Meeting Today<\/li>\n<li>Should You Buy Gold in September 2025?<\/li>\n<\/ul>\n<p class=\"body__disclaimer\">The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/section>\n<p>        <script type=\"text\/javascript\">   \/\/ add oddAd class to every odd instance of body .ads__inline for different placeholder styles   let articleAds = document.querySelectorAll('.ads__inline');   for (let i = 0, len = articleAds.length; i < len; i++) {     \/\/ Do the below only if the curent count is less than 12     if ((i < 12) &#038;&#038; (i % 2 === 0)) {       articleAds[i].className += ' oddAd';     }   } <\/script>                                               <\/p>\n<div class=\"jupiter22-c-tags jupiter22-c-tags-default\">\n<h3 class=\"jupiter22-c-tags-title\">         Tags       <\/h3>\n<div class=\"jupiter22-c-tags-container\">Stocks<\/div>\n<\/p><\/div>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>The dollar index (DXY00) on Monday fell by -0.22%.\u00a0 The dollar moved lower on Monday due to speculation that weak US labormarket newsthis week, including the August JOLTS job openings, the September ADP employment change, and the September nonfarm payrolls, will prompt the Fed to continue cutting interest rates. \u00a0Also, the looming risk of a 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