The dollar index, which measures the greenback against a basket of major currencies, settled slightly higher at 97.38. Market participants are looking forward to the December Consumer Price Index to grasp more insight on inflation. On the other hand, the Chinese delegation arrived in Washington to sign phase 1 of the trade deal, and the US Treasury department reversed its decision on designating China as a currency manipulator. The recent developments kept the dollar at a bid against safe assets where the USDJPY rose to an eight-month high of 110.21.
The British pound extended losses against rivals following softer-than-expected economic data. On the weekend, a Bank of England policymaker stated that he would vote for cutting interest rates if the economic data fail to surprise to the upside. The data revealed that the UK economy contracted by 0.3% month-on-month, industrial production dropped by 1.2%, and manufacturing production declined by 1.7% in November. The sluggish data raised the chances of an interest rate cut in January meeting to 49% as per the CME Bank of England Watch Tool. The GBPUSD drifted lower to $1.2960, and the EURGBP logged a three-week high of 0.8591.
Gold prices tumbled to a ten-day low amid enhanced risk sentiment. The easing geopolitical tensions and renewed trade optimism lessened the investors' demand for safety. The price of a gold ounce fell to $1535, the price of a silver ounce drifted lower to $17.68, while palladium edged higher to $2142.
Oil prices dropped to a five-week low as geopolitical tensions eased further. The West Texas Intermediate crude futures declined to a $57.87, and Brent futures plunged to $63.90. Market participants are looking forward to the US weekly crude oil stock by the American Petroleum Institute later today, and the official numbers by the US Energy Information Administration tomorrow.