US Dollar Strength Lowers Prices of Oil and Gold

The dollar continued to strengthen on Monday, sending oil and gold prices lower, after the Group of Seven backed Japan’s efforts to spur growth via aggressive monetary easing.

An unexpected rise in U.S. retail sales in April as households bought cars, home improvement materials and a range of other goods, also underpinned the dollar as it pointed to underlying strength in the world’s biggest economy.

Wall Street, however, was expected to see some mild profit taking on opening following a stellar run to record highs.

The dollar, which has risen 5 percent against a basket of major currencies since February, and double that versus the yen, looked unlikely to buckle after officials at a G7 meeting in Britain over the weekend showed little concern about the yen’s slump.

It hit a new 4-1/2 year high of 102.15 yen in Asian trading and was on the front foot again at 102.96 yen and $1.2953 against the euro following the U.S. retail sales numbers.

via Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.