Currencies and metals rally after the Powell comments

• Currencies & metals rally after the Powell comments

• Here we go again with Japan.

Good Day... And a Tub Thumpin' Thursday to one and all! A whirlwind Wednesday for yours truly, with a trip to meet some friends, and all the laughter and fun on the evening... This time in S. Florida seems to going too fast, and it won't be too long before I'm heading back to St. Louis... UGH! Not that I don't like my home, it's just that it's not S. Florida... Weezer greets me this morning with their song: Island In The Sun.

Well... here we go again! Catch us if you can... time to get a move on... We will run with all of our hearts! Oh, for the Dave Clark 5 to be singing this instead of me at this hour of the morning! But here we go again, with the rate cut talk, and this time it was Jerome Powell who supplied the news.... Give me BREAK! Stocks rallied, Gold rallied, and bonds rallied... All because Powell said that we could see a rate cut by year end.

You may remember that it was Powell who just a couple of weeks ago, said that there were no plans for a rate cut this year...  UGH! So, as long as there is a chance, slim chance, and slim apparently didn't leave town, the dollar is getting sold... The BBDXY lost 4 index points yesterday, and the euro started knocking on the 1.09 handle... I just don't get it... Inflation isn't going away, and Powell is talking about a rate cut? Was this his attempt to throw the stock market jockeys a bone? Probably... because you do know that the deep state is Powell's boss, and they don't like seeing their stock holdings going down in value... I'm just saying.

Gold was already in rally mode when the Powell words became public, and Gold took off! Gold, on the day, gained $20.60 and finished the day at $2,147.90.. Silver too saw its early morning small gain turn to something to write home about, with Silver gaining 53-cents on the day to finish at $24.15... It was a day without interference by the short paper traders, and that makes me smile... I totally dislike those ba%^$#Ws, and hope they get to visit Satan in the afterlife... But we move on here.

The dollar got sold after the Powell comments, and the BBDXY lost 4 index points on the day, So, here we go again with the dollar... in the overnight markets the BBDXY lost 3 more points, so the selling in intensifying for the dollar, and we all know what happens when that gets to intense, right? The PPT steps in a protects the dollar... So, don't get all giddy about your currencies until we sort through what the PPT is going to do.

The euro, is closing in on 1.09, again... and the rest of the currencies all look healthier this morning... The price of Oil remains trading with a $78 handle, and bonds seemed to be the trade of the day yesterday, with the 10-year's yield dropping to 4.16%... Throw the bond boys a bone, and they go hog wild with their ideas that they will see multiple rate cuts soon... They are trained like Pavlov's Dog... Good boy... sit, good boy.

In the overnight markets last night the dollar got sold some more, with the BBDXY showing another 3 point loss. The euro inches toward 1.09 again, and the rest of the currencies are looking healthier this morning. Gold is up $6 in the early trading today, and Silver is seeing some profit taking, but remaining above $24, as we start our day... Bonds really got bought overnight, with the 10-year's yield dropping to 4.10%!  Unbelievable! Who's doing that buying? I'm at a loss here folks.

Well, in Japan this week, their latest inflation report showed that inflation had gained from 1.9% to 2.6%, and that has the rate hike folks all up in arms again... Fool me once, but you won't fool me twice... The yen is rallying on the inflation news, and Japanese bonds are getting bought again... Seen all this before? Yes, we saw this scenario all play out earlier this year, and then as usual the Japanese disappointed the markets, and they most likely will do that again... I'm just saying.

The European Central Bank (ECB ) is meeting as I write this morning, and my thought here is that the ECB will keep rates unchanged, and only give the markets a hint that rates would be moved lower, slowly, in the future, as long as inflation remains somewhat tamed.

Well... I had a dear reader write to me yesterday, and ask me about Executive Order 14067, that was signed on March 9, 2022.... I told him the same thing that I'll tell you now:" I wrote in May of 2020 that we would be getting digital currencies soon… I talked about how they would bring about lower deposit rates, and government surveillance and that closing your account and going to the bank down the street wouldn’t Matter because all banks would be the same.

The loss of your folding cash and ability to keep your purchases private will be the biggest problems. 

There’s also the idea that the bank could take exception to your spending… and fix fines to your balance or take control of your account very easily because the government is behind them…. "

They call the executive order Ensuring Responsible.

Development of Digital Assets ... Once again I was years ahead of this, and tried to get people to contact their representative and tell them to go to hello operator give me number 9.... if they allowed this to happen.

The U.S. Data Cupboard yesterday has the ADP Employment Report for Feb, and it showed that only 140,000 jobs were created in Feb. (150,000 were expected)... Again, Chuck believes that this is the jobs report that everyone should use, not the cockamamie B.S. that the BLS gives us... The Job Openings last month remained at 8.9 Million.. 

To recap... Powell threw the dollar under the bus yesterday, with his comments about how there could be a rate cut later this year... This after he told us earlier that there would be no rate cut this year... The bond Boys went hog wild, and the Gold bugs were happy campers... The whole day was a result of Powell's words... Now that's a shame isn't it? 

Here's your snippet: " Once hurt by crises and deflation, the euro is gaining popularity among central bank reserve managers thanks to a return to positive rates and geopolitics challenging king dollar's appeal.

Roughly one in five of the 75 central banks surveyed by the London-based OMFIF think-tank anticipate increasing euro holdings over the next two years, its recently published 2023 report showed.

While 7% looked to decrease euro holdings, net demand was higher than for any other currency during the period and a jump from the 2021 and 2022 surveys of reserve managers controlling nearly $5 trillion.

Shifts can take years to play out. The dollar, which makes up 60% of global reserves versus the euro's 20%, will not lose its crown overnight.

Yet, a more positive euro outlook speaks to notable changes taking place.

For starters, the European Central Bank's exit from negative interest rates in 2022 drove euro area government bond yields higher after almost a decade below 0%, and they should remain elevated even as rate cuts near.

Germany's 10-year Bund yield has stayed above 1.9% since late 2022.

"Now the euro is positive yielding, (reserve managers) are looking to increase their currency allocation to the euro and specifically away from the dollar," said Taylor Pearce, OMFIF senior economist.

"For some central banks, because the euro wasn't yielding anything, they had held a higher share of dollars and especially dollar-denominated government bonds."

Poland's central bank, whose reserves are dominated by dollar and euro-denominated assets, told Reuters that while it did not comment on changes to reserves, "medium-term expected returns for euro area government bonds have improved considerably, which certainly increases the appeal of the asset class".

Chuck again... and as I always point out... The euro is the offset currency of the dollar, and so as the dollar goes, the opposite holds true for the euro... You should remember that, for when the dollar goes into a long term weak trend.

Market Prices 3/7/2024: American Style: A$ .6604, kiwi .6151, C$ .7405, euro 1.0895, sterling 1.2755, Swiss $1.1372, European Style: rand 18.9616, krone 10.4708, SEK 10.2861, forint 363.20, zloty 3.9513, koruna 23.2897, RUB 90.89, yen 147.80, sing 1.3355, HKD 7.8225, INR 82.78, China 7.1979, peso 16.85, BRL 4.9467, BBDXY 1,233.78, Dollar Index 103.17, Oil $78.40, 10-year 4.10%, Silver $24.19, Platinum $926.00, Palladium $1,062.00, Copper $3.93, and Gold... $2,156.40.

That's it for today... Well the first week of March certainly has been interesting... I think by the time summer arrives, this county could be in some real trouble financially, morally, and ethically... I guess the people of this country want to see the two old geezers go at again in the presidential vote... That's all I have to say about that! I'll be in my seat today for the Cardinals and Astros at Roger Dean Stadium... Look for me! HA! Our Blues get on the ice tonight in New Jersey... This Sunday will the start of Daylight Savings Time, and it will be the birthday of my good friend, Rick B... So, Happy Birthday early, and I hope you have a grand day, my friend! The Moody Blues take us to the finish line today with their song: Ride My See-Saw... I hope you have a Tub Thumpin' Thursday today, and will Be Good To Yourself!