The dollar index fell by -0.44% after weaker-than-expected US economic news, increasing the chances of a Fed rate cut in December. Falling bond yields also contributed to the dollar’s decline.

US Sep retail sales rose +0.2% m/m, while Sep PPI final demand exceeded expectations at +2.7% y/y. However, Sep PPI ex-food and energy fell short at +2.6% y/y.

ADP reported US private payrolls fell by an average of -13,500 per week in the four weeks ending November 8. Meanwhile, the US Sep S&P CaseShiller composite-20 home price index rose +1.36% y/y.

US Oct pending home sales rose +1.9% m/m, indicating a stronger housing market. The FOMC is expected to cut the fed funds target range by 25 bp at the next meeting on December 9-10.

EUR/USD rose by +0.45% on Tuesday, supported by a weaker dollar and positive economic news. Eurozone Oct new car registrations rose +5.8% y/y, signaling economic growth.

Swaps indicate a 2% chance of a -25 bp rate cut by the ECB at the December 18 meeting. USD/JPY fell by -0.56% due to concerns of Japanese intervention in the forex market.

Gold and silver prices surged on Tuesday after weaker US economic news increased expectations for a Fed rate cut in December. Central bank demand for gold remains strong.

Despite positive factors, like central bank demand, precious metals face challenges such as reduced safe-haven demand due to improved prospects for peace in Ukraine and easing inflation expectations.

Long liquidation pressures have weighed on precious metals prices since mid-October, despite strong central bank demand and recent positive news on gold reserves.

Read more at Yahoo Finance: Dollar Tumbles and Gold Rallies on Improved Fed Rate Cut Chances