In reaction to today’s U.S. GDP release, the U.S. dollar eased back slightly after it had staged a bounce the day before. As my colleague Matt Weller reported earlier, the first estimate of second-quarter growth for the world’s largest economy came in at 4.1% annualized, the highest rate since 2014.
The dollar lost more than 3% in 2018 against the euro, while gold jumped above $1,350 per barrel (as of January 25).
Central banks remain powerful creatures. Will gold escape from their grip?
The big moves have occurred in the stock markets with index futures tumbling in overnight trading, before bouncing back slightly. The stock market losses have been triggered by the recent sharp falls in government bond prices, which have helped to push yields higher.
The rally in Asian equities resumed on Tuesday taking the lead from Wall Street, after the U.S. government shutdown came to an end on Monday.
As trading winds down ahead of Christmas and New Year, volatility in the financial markets are likely to dwindle over the coming week and a half.

1. The Vote

The USD will finish the week mixed with major pairs.

Chinese data shrugged off as equity markets edge slightly lower; sterling under pressure as pressure on May mounts; central banks event sees Fed, ECB, BoJ and BoE heads join panel discussion; German GDP and inflation data get us off to an underwhelming start.