The U.S. dollar was stable on early Tuesday trade after reaching its weakest level in three years on the previous trading day. The currency managed to hold on despite worries that the tremendous U.S. budget deficit might damage the economy.
the U.S. dollar index stabilized at 89.215. It traded about 1 percent higher from a three-year low of 88.251 notched last Friday. Remarks from U.S. Treasury Secretary, Steven Mnuchin, raised concerns among investors that the country might push through a policy that involved a weaker currency after trade deficits edged up to an almost ten-year high. What is more, expectations of a future fiscal deficit of $1 trillion next year are pulling down the dollar
As to other currency pairs, versus the Japanese yen, the dollar jumped by 0.15 percent closing at ¥106.75 after recovering from a 15-month low of 105.545 touched on Friday. Meanwhile, the euro kept stable at $1.2406.
Gold futures dropped for the third time on Tuesday due to the U.S. dollar’s recovery from a three-year low. Investors are currently anticipating the minutes from Fed’s last policy meeting scheduled to be released tomorrow.
U.S. gold futures dropped as low as 1 percent closing at $1,342.90 an ounce. Spot gold was traded 0.4 percent higher at $1,341.20 an ounce. As to other precious metals, platinum fell by 0.1 percent towards $1,001.24; palladium edged down by 0.4 percent to $1,028.65. Spot silver went lower by 0.6 percent and settled at $16.57.