The US Dollar is stronger at the beginning of the American session. It happened after the market participants saw that there is an inflation increase based on the Personal Consumption Expenditure or PCE. 

The American PCE is higher. The data showed that it increases from 0.4% to 0.7% which means beyond the expectation of 0.6 percent. People believed that this data is important and highlighted by The Fed. 

The Federal Reserve may uses it as the inflation measurement although the Consumer Price Index or CPI will be released for about 10 days after that. Several things has been changed.

The Index of USD Condition

So far, the index of US dollar has been getting a pressure during April and May. It has even reached its lowest level in four months. However, it shows the different direction this week. 

Several analysts stated that it is as an impact of the month end flows. The Index of USD experienced an increase at the end of the Asian session and at the beginning of the European session yesterday. 

It was stronger by 0.1% to the level of 90.44. To the Yen, the USD was successfully getting the highest level in seven weeks. That was in 110.198. The analysts highlighted the Japanese jobless Rate. 

They also pay attention to the consumer price declining. For your information, Japan extends its emergency status in Tokyo and other areas for three weeks longer. 

The Effect of Coronavirus Pandemic

There is a reason why Japan and its government extend the emergency status. They think that that the coronavirus cases are not flattening yet. The further actions still need to be taken due to that pandemic. 

Meanwhile, the market participants are generally focused on the inflation data and the central banks decisions directions. The European Central bank released the dovish clue for this week. 

That becomes an obstacle for the euro movement ahead of the meeting to get the interest rate decision. The meeting itself will be held in 10 of June later. Some predictions are made so far. 

One of them is about the Reserve Bank of Australia that may takes the decision to increase the interest rate. Yesterday, the Bank of England representative stated that BOE may has the same decision. 

The Rate May Be Increased Since the Beginning

That representative said that BOE can increase the rate since the beginning of the second semester. However, there is also a possibility that they will delay it until 2022 next year. 

Meanwhile, the Fed is predicted to tight the interest rate. That speculation is supported by the data release by PCE which is higher than the expectations. Elsewhere, the price of gold is stable. 

It is under the key lebel of $1.900/ounce on Thursday because of the US treasury yield which is balancing the optimistic data. That is about the American economic recovery which may becomes the best one. 

The spot of gold was changed in $1,896.76 per ounce. Meanwhile, the American gold declined by 0.3 percent to the level of $1,898.5. The American econoy is in a srong path for its growth. 

The Inlation Argument is getting Faded

It cannot be denied that the opinion about inflation is faded. The Fed is able to make the market believe that the situation is just temporary. It just like a break amidst the increasing trend lately. 

A release shows that the new United States jobless claim is decreasing more than it is expected.  Meanwhile, the economic stream is fastened in its first quarter. The treasury treasury result was slightly declined. 

The investors are waiting for th personal consumption report in USA. There are not many people are coming to purchase that precious metal and this situation has been happened for 2 months in a row.