Forex traders had reacted little the previous day, with the GDP inflation rate coming in at +3.7% (vs. 3.4% expected), but they are reacting nervously this Friday to the confirmation of a rebounding trend in prices at the end of Q1, with the release of the PCE inflation index, which came in at +2.7% in March, vs. 2.5% in February, with the underlying rate (excluding energy and food) holding steady at 2.8% month-on-month.
The dollar recovered by an average of 0.4% and the $-Index climbed back to 106.05, ending the week unchanged.
The Euro retreated -0.3% to 106.90 (gaining 0.35% on the week), but the most spectacular gap materialized on the $/yen pair: the Japanese currency plunged -1.4% to 157.80, a 34-year low (or -2.1% on a weekly basis).
The BoJ is clinging to its forecast of 2% inflation in 2024 and 2025, which doesn't seem to be convincing currency traders.... it may have to intervene this weekend to put out the fire.

Returning to the Euro, the suspense remains as to the downgrading of French debt by Fitch and Moody's: it is widely anticipated and should not cause any major upheaval.

As for the "number of the day", US inflation is a little higher than expected by economists, with Jefferies forecasting a rate of 2.6% on a gross basis and 2.7% on an underlying basis.
The Commerce Department also reported that US household spending rose by 0.8% in March compared with the previous month, while household income rose by 0.5%.
US consumer confidence deteriorated more sharply than initially estimated in April, the final results of the University of Michigan's monthly consumer confidence survey showed on Friday.

The confidence index finally came in at 77.2, lower than the first estimate (77.9) and down sharply on the 79.4 level reached in March.

The component of households' judgment of their current situation deteriorated most sharply, to 79 from 82.5 last month.

The expectations component fell to 76 this month from 77.4 in March.
Gold ended the week on a rebound of +0.9% to 2,340, representing a modest consolidation of -2% in view of the interest-rate tension observed in the United States (with the '10 yr' remaining close to 4.66% and the '2 yr' in contact with 5.00%).


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