Dollar Falls Despite Strong US GDP Report

Economic Indicators - US industrial production in November fell by -0.1% month-over-month, which was weaker than market expectations of +0.1% [1] - Manufacturing production in November decreased by -0.4% month-over-month, also below expectations of +0.1% [1] - Durable goods orders in October fell by -2.2% month-over-month, worse than the expected decline of -1.5% [2] - Core capital goods orders in October rose by +0.5% month-over-month, slightly above expectations of +0.3% [2] - The Philadelphia Fed non-manufacturing index for December fell to -16.8, lower than the expected rise to -15.0 [3] - The US consumer confidence index for December decreased by -3.8 points to 89.1, below the expected level of 91.0 [3] GDP and Inflation - The US Q3 real GDP rose by +4.3% quarter-over-quarter annualized, surpassing expectations of +3.3% [4] - The Q3 GDP Price Index increased by +3.8% quarter-over-quarter annualized, significantly above expectations of +2.7% [4] - The Q3 core PCE Price Index rose by +2.9% quarter-over-quarter annualized, in line with expectations [4] Currency and Monetary Policy - The dollar is under pressure due to the Fed's liquidity boost, with $40 billion monthly purchases of T-bills starting in mid-December [5] - The dollar index (DXY) fell by -0.22%, despite a stronger-than-expected GDP report [7] - The FOMC is expected to cut interest rates by about -50 basis points in 2026, while the Bank of Japan is anticipated to raise rates by +25 basis points [6] Precious Metals Market - Gold and silver prices increased, supported by strong central bank demand and geopolitical risks [12][14] - The PBOC's gold reserves rose by +30,000 ounces to 74.1 million troy ounces in November, marking the thirteenth consecutive month of increases [14] - Silver inventories in Shanghai fell to 519,000 kilograms, the lowest level in 10 years, contributing to price support [15]