Forex Today: US Dollar extends recovery, Gold holds near record-high
Here is what you need to know on Friday, March 14:
The US Dollar (USD) holds its ground in the European morning on Friday, with the USD Index staying in positive territory near 104.00 after posting modest gains for two consecutive days. The US economic calendar will feature the University of Michigan's preliminary Consumer Sentiment Index data for March heading into the weekend.
US Dollar PRICE This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.05% | -0.06% | 0.61% | 0.40% | 0.07% | -0.01% | 0.46% | |
| EUR | 0.05% | -0.04% | 0.69% | 0.46% | 0.22% | 0.01% | 0.40% | |
| GBP | 0.06% | 0.04% | 0.65% | 0.47% | 0.26% | 0.00% | 0.51% | |
| JPY | -0.61% | -0.69% | -0.65% | -0.22% | -0.48% | -0.70% | -0.07% | |
| CAD | -0.40% | -0.46% | -0.47% | 0.22% | -0.37% | -0.41% | 0.04% | |
| AUD | -0.07% | -0.22% | -0.26% | 0.48% | 0.37% | -0.19% | 0.24% | |
| NZD | 0.01% | -0.01% | -0.01% | 0.70% | 0.41% | 0.19% | 0.55% | |
| CHF | -0.46% | -0.40% | -0.51% | 0.07% | -0.04% | -0.24% | -0.55% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Senate Democratic Leader Chuck Schumer announced late Thursday that he plans to vote to keep the government open as the chamber prepares to take up a GOP stopgap bill continuing government funding Friday. US stock index futures were last seen rising between 0.5% and 0.8% after Wall Street's main indexes registered large losses on Thursday. Meanwhile, the benchmark 10-year US Treasury bond yield holds steady, slightly below 4.3%.
In the early European session, the UK's Office for National Statistics reported that the UK's Gross Domestic Product contracted by 0.1% on a monthly basis in January. Other data showed that Manufacturing Production and Industrial Production decreased by 1.1% and 0.9%, respectively, in the same period. These figures came in weaker than analysts' estimates and caused Pound Sterling to come under pressure. At the time of press, GBP/USD was trading in the red below 1.2950.
Gold preserved its bullish momentum and rose more than 1.8% on Thursday. After reaching a new record-high above $2,990 during the Asian trading hours on Friday, XAU/USD seems to have entered a consolidation phase near $2,980.
EUR/USD struggles to gain traction and trades slightly below 1.0850 in the European morning on Friday. In a social media post on Thursday, US President Donald Trump said that he would seek to impose his 200% tariff on European wines and champagne. In response, French Finance Minister Eric Lombard said Trump's threat to augment tariffs on French liquor imports were not a surprise and called his actions an "idiotic war."
USD/CAD rose about 0.5% on Thursday and erased Wednesday's losses. The pair stays relatively quiet and fluctuates around 1.4400 early Friday. Canada's Finance Minister Dominic LeBlanc said late Thursday that tariffs are harmful to both the US and Canada, adding that moving forward with dialogue is crucial.
After posting small losses on Thursday, USD/JPY gathers bullish momentum and rises about 0.8% on the day near 149.00 on Friday. Japan's largest trade union group Rengo announced on Friday that the first-round data showed an average wage hike of 5.46% for fiscal year 2025, below the 6.09% hike demanded.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
