The yield curve is flattening, gold is spiking, and the dollar is puking... all has the smell of 'policy error'?
The dollar is down hard since Powell's comments on inflation...
As Bloomberg's Richard Breslow notes:
The Bloomberg Dollar Index is trading right at 1195, which is a big technical level by several different measures. It should function as an important pivot area. Aside from the index as a whole, there are legitimate reasons to be watching upside targets for a number of the currencies making up many of its component parts. With the momentum currently in that direction. But they haven’t crossed through yet. And, something I didn’t expect to see today, USD/JPY is toying with the notion of whether it has any interest in sneaking below its 21-day moving average. That would be a shocker. As a guess, the BOJ is unlikely to have interest seeing the pair much below 108.
Gold bounced off its 21-DMA and currently attempting to tackle its 55-DMA. Sub-1500 just looks like a place it doesn’t want to be. If it goes back below there, you will have learned something important.
And as the dollar dived, gold surged...
And the yield curve continues to flatten...
We're gonna need a Trump trade tweet.