In a volatile end to the quarter, the US dollar made a strong comeback, regaining losses from earlier trading sessions and even reaching new highs. This surge was particularly evident in the USD/CAD pair as oil prices reversed their gains and ended the week flat. Treasury yields initially declined but rebounded later, causing equity markets to finish the quarter largely unchanged after an initially strong start. Overall, the moves were primarily driven by quarter-end flows rather than underlying fundamentals, with inflation numbers in the PCE report being mildly disappointing and Williams adopting a dovish stance.
As the quarter drew to a close, gold experienced another significant drop, reaching its lowest point since mid-March. Despite entering North American trade on a weaker note, the US dollar rallied strongly and broadly, ultimately finishing the day mostly unchanged. With the close of the week, month, and quarter, traders are now eagerly awaiting the October seasonals for potential market insights.
In conclusion, the US dollar staged a remarkable recovery at the end of the quarter, erasing prior losses and establishing new highs. This resurgence was particularly noticeable against the Canadian dollar due to a reversal in oil prices. While Treasury yields initially declined, they later rebounded, resulting in a mixed performance for equity markets throughout the quarter. The market movements seemed to be driven more by quarter-end flows rather than fundamental factors, with softer inflation numbers and dovish remarks from Williams contributing to the unpredictable environment. Gold experienced significant losses, hitting its lowest point in months, and the US dollar ultimately ended the day mostly unchanged. Traders are now eagerly anticipating the release of October seasonals for potential trading opportunities.