Not much happened today in either the stock market or the bond market. Dull days are good for a change. The markets are no longer responding to every comment coming out of the White House. On Sunday, President Donald Trump called Fed Chair Jerome Powell "a total stiff." But he also said that he will not remove the Fed Chair. Today, Treasury Secretary Scott Bessent observed, "The United States is the premier destination for international capital." The dollar index (DXY) edged up slightly. On the other hand, the price of gold jumped sharply higher to $3386.60 this evening (chart).
The Fed released last week's daily readings for the "broad" trade-weighted dollar. It hasn't been as weak as DXY, which is a fixed-weight currency index with the euro having a weight of 57.6% (chart)!
Not to dismiss the recession debate that seems everywhere you turn these days, but it's beginning to give off a "yadda-yadda-yadda" energy. Chatter about a tariff-driven downturn often seems at odds with the data and market dynamics. Case in point: the yield curve is ascending (chart). That doesn't tend to happen before an economy slides into the red.
