If we look at the U.S. dollar's action in the context of financial market risk-on, versus geopolitical risk-off, it seems like the point of greatest tension with North Korea may already have passed.
Notice on the DXY that the price structure rolled over in a significant way last week, either reflecting concern about a faltering U.S. economy or less concern about a nuclear standoff — or both.
An interesting aspect of DXY weakness is that it is buoying spot gold prices despite the post-weekend depletion of geopolitical risk premium.
Gold climbed about $50 during the past week, which coincided with the weakness in USD.
Continued dollar weakness now in reaction to weaker-than-expected U.S. economic data, coupled with delay and disappointment about the Trump growth agenda, is keeping interest rates (on the long end) under pressure, also a supportive factor for spot Gold.
