The U.S. Dollar Index weakened overall this week before stabilizing; it briefly touched a level near a six-week low during the session and stood at 100.18 at the time of writing. The dollar faced pressure primarily from uncertainty surrounding the Fed’s interest rate path and adjustments to market expectations regarding the policies of other major central banks. Meanwhile, the yen’s rapid rebound following suspected foreign exchange market intervention also dampened demand for the dollar.
Gold prices fluctuated this week. On the one hand, the market was supported by the dollar’s temporary weakness, geopolitical risks, and safe-haven demand; on the other hand, rising U.S. Treasury yields limited gold’s upside potential. Gold prices edged lower on Friday as investors took partial profits and the market reassessed the outlook for Federal Reserve policy.As of press time, spot gold was trading at $4,043 per ounce.
International oil prices retreated overall this week compared to previous levels, with both WTI and Brent crude posting significant declines; they are expected to close lower for the first time in four weeks.Previously, tensions in the Middle East and supply risks had kept oil prices elevated, but as conditions along some supply routes improved, the market refocused on inventories and the supply-demand balance.
Non-U.S. currencies found support overall this week, with the Japanese yen taking center stage.The USD/JPY pair fell sharply following what appeared to be coordinated intervention by Japan, the U.S., and South Korea, briefly dipping below 158 before recovering a small portion of its losses. The euro and British pound benefited overall from the dollar’s weakness, as the market continued to focus on the divergence in monetary policy between the European and U.S. central banks and the performance of economic data, with capital flows shifting partially from U.S. dollar-denominated assets to other major currencies.
In the stock market, South Korea’s stock market experienced sharp volatility this week. The KOSPI index initially plummeted due to valuation concerns in the AI sector and a sell-off in chip stocks, but then staged a historic rebound on Friday, rising approximately 17.9% in a single day and recouping some of its losses.The market turnaround was primarily driven by earnings reports from major tech companies like Microsoft, which alleviated concerns about an AI investment bubble and spurred a return of capital to the semiconductor sector. Samsung Electronics rose by about 28% in a single day, while SK Hynix gained 30%, becoming the core drivers of the index’s rebound.