The Dollar gets ambushed overnight
- Something's happening here and what it is I can't see.
- Gold/Silver are back on the rally train.
Good Day... And a Tub Thumpin' Thursday to one and all! Well! I'm a grandparent again to our 5th grandchild and the first for Alex and Grace... A bouncing baby boy was born yesterday mid-day and I rushed to the hospital to see him and them! Grace was in the hospital yesterday morning while I was writing, and Kathy scolded me and told me not to say anything in the Pfennig about that... I guess she knows me all too well! Cat Stevens greets me this morning with his song: If Your Want To Sing Out, Sing Out...
Well, the damage to the currencies took place overnight Tuesday to Wednesday, as I described here yesterday. But... as yesterday unfolded, the dollar buying ended and in fact some selling began, thus leaving the BBDXY at 1,224... up 2 index points on the day, but down 1 index point from the high of the day.
And Gold did hold onto its early morning gains yesterday, as it gained $25 to close at $4,038, and Silver gained $1.05 to close at $59.23... The SPTs were there and moved the metals around a bit, but the physical buying and ETF buying was greater this day, so Gold & Silver gained...
The price of Oil slide further yesterday and ended the day with a $67 handle... That's down $4 from where it traded on Monday this week, but is a direct illustration of what's going on in the Gulf...
The 10-year Treasury was stuck in the mud yesterday and ended the day the same as it started, with a 4.48% yield.
In the overnight markets last night... Whoa, there partner! What the heck went on overnight and early this morning? Well, the BLS reported that they saw only 57,000 jobs created in May, for one... But other than that, I can't find a thing that tells me why the dollar has been getting sold... The BBDXY is down 6 index points to start our day, and Gold is up $109! I hate it when there's nothing on the news wires to tell me what's going on, and yet, something BIG has happened...
This downward move in the dollar is not unexpected by me, as I was scratching my bald head wondering why the dollar was so strong, and it still is somewhat strong, but not as strong... Oh, well, I'll go into the weekend with my red, white, and Blue on wondering what caused the dollar to get whipsawed... I'm sure to have an answer on Monday next week....
Gold is up $109 this morning, and Silver is up $1.56... Let's see the STPs try to take them down now!
The price of Oil remained trading with a $67 handle overnight, and the 10-year Treasury remained trading with a 4.48% yield...
Well, have you heard the news that China is attaching Gold to their currency? Boy, I remember many years ago, when I said that's why they were amassing so much physical Gold... I also remember that people like James Rickards laughed at that idea....
He wasn't the only analyst that thought I had gone off my rocker...
But I'm firmly on the rocker as China has announced a small piece of Gold that will be backing their new digital currency... Hey! They are not in the business of giving away the store! So, whatever the amount of Gold that's backing the currency and convertible to... it will be worth more than a dollar that's really only backed by good faith....
Or, you could argue that the dollar is backed by Treasuries... And in my mind that's only bit better than "good faith" as Treasuries are getting sold by Countries all over the world right now.... Yes, these same countries are still showing up at the auction window, but not with grand designs of buying boat loads of Treasuries...
And as I've described previously, many times I might add, Treasuries are what we use to finance the issuance of dollars... All of our current $39 Trillion national debt is secured by Treasuries, or are they? With money supply growing like a weed, more Treasuries will have to be sold at a time when Central Banks are backing away from buying so much....
The U.S. has only two choices... They can stop deficit spending and take a chainsaw to the current Debt... Or, they can raise the yield on the Treasuries they are trying to sell to make them more attractive so they will hopefully be bought....
It's been some time since I got up on the pedestal and Opined like that, but since that's what I'm known for... I let loose!
The U.S. Data Cupboard yesterday had the ADP Employment Report and it showed that 122,000 jobs were added in May, up from 105,000 in April... Ok, do you recall when jobs were going by the wayside in the ADP but the BLS would shows great gains in jobs? Well, with the ADP showing job growth, I can only imagine what the BLS will show as jobs created in May will be today...
The U.S ISM (manufacturing index) was up and over the 50 level that denotes expansion... So, the economy has that going for it...
To recap... The dollar buying overnight from Tuesday night ended in the U.S. time Wednesday and in fact, the dollar saw some selling here... Gold/Silver gained on Wednesday even though the SPTs were around... keeping the metals in check... and China makes a new announcement!
For What It's Worth... Well, since in two days, we as a country will celebrate our 250 anniversary as a free country.... And I'm certain that many a back yard will be busy with BBQ pits all fired up...
Here's your snippet: "U.S. grill masters and home chefs face sizzling beef prices for summer cookouts as drought and wildfires have discouraged ranchers from expanding cattle supplies that are at their lowest levels in 75 years.
The record-high beef prices have strained the wallets of U.S. consumers who also saw gas prices spike because of the Middle East conflict. Though demand has remained generally strong for steaks and hamburgers, some shoppers have shifted to other proteins, such as chicken, to save money.
Ahead of Independence Day on July 4, a major holiday for grilling, the Wells Fargo Agri-Food Institute estimated the cost of a summer barbecue for 10 people will rise by 2.4% from last year to $161, with hamburger beef up 14%.
"There is no real lever to pull in the domestic market to get more supply in the short term," said Michael Swanson, Wells Fargo's chief agricultural economist.
President Donald Trump has encouraged low-tariff imports of Argentine beef to cool U.S. prices, angering American ranchers, and directed the Department of Justice to investigate whether U.S. meatpackers are colluding to raise prices."
Chuck Again... Give me good old midwestern raised cattle for my beef, that's what I say!
Market Prices 7/2/2026: American Style: A$ .6925, kiwi .5698, C$ .7052, euro 1.1445, sterling 1.3367, Swiss $1.2486, European Style: rand 16.2720, krone 9.8398, SEK 9.6634, forint 309.70, zloty 3.7435, koruna 21.1404, RUB 77.72, yen 160.90, sing 1.2911, HKD 7.8426, INR 95.39, China 6.7867, peso 17.46, BRL 5.1956, BBDXY 1,218, Dollar Index 100.78, Oil $67.68, 10-year 4.478%, Silver $62.14, Platinum $1,638.00, Palladium $1,298.00, Copper $6.19, and Gold... $4,142.
That's it for today... So, we have a new baby in the family... Everybody loves a baby! Brooks Butler is his name, and he was born one day after his Dad's (Alex) birthday... I told Kathy that he did that on purpose! HA! My beloved Cardinals didn't win last night in Atlanta, but the U.S. Men's Soccer Team won, and they even had to play one man short for a long time in the 2nd half.... Now they are onto the round of 16, where they will play Begium on Sunday... My song for the finish line today is a fave of mine... Poco's Rose of Cimarron... if you don't get moved by his song, then I don' know what to tell you! I hope you have a Tub Thumpin' Thursday today and Please Be Good To Yourself!
Author
Chuck Butler
The Aden Forecast
Chuck has a long history of being associated the investment markets. He started in a regional brokerage firm in 1973, and it was just like the act of Nixon taking the U.S.
