Core PPI prints +0.8% — hottest in six months — and the dollar falls. DXY closes at 97.60 as tariff-driven inflation fails to generate sustained dollar strength. Gold +1.18% to 5,248.
| Instrument | Close | Chg | Note |
|---|---|---|---|
| S&P 500 | 6,908 | −0.8% | Hot PPI + AI skepticism; VIX spiked to 21.35 |
| Nasdaq | 22,878 | −0.93% | NVDA −5% post-earnings; software rout deepening |
| Brent | $72.73 | +2.2% | Iran risk premium rising; USS Ford deployed to eastern Med |
| US 10Y | ~4.03% | +2 bps | Hot PPI nudging yields higher; curve still flat |
| VIX | 21.35 | +14% | Highest since November; risk-off accelerating |
January PPI: headline +0.5% m/m (consensus 0.3%, prior 0.4%). Core +0.8% m/m (consensus 0.3%, prior 0.6%) — highest monthly core reading since July 2025. Year-on-year core at 3.6% versus 3.0% expected. Services prices +0.8%, driven by a 14.4% increase in professional and commercial equipment wholesaling margins. Visible tariff pass-through in apparel, chemicals, and telecommunications.
DXY response: session high of 97.85 printed immediately post-release, sold within minutes. Close at 97.60, down 0.19% on the day. This marks the third instance in February where above-consensus inflation data failed to produce sustained dollar strength (CPI on Feb 12, PPI today). EUR/USD closed at 1.1820 (+0.19%). USD/JPY edged lower to 155.97 (−0.10%).
Gold: XAU/USD traded a range of 5,167–5,258, closing at 5,248 (+1.18%). This is the strongest daily close since late January and sits 6.2% below the January 28 all-time high of 5,595. Equities sold off — S&P 500 −0.8% to 6,908, Nasdaq −0.93%, VIX +14% to 21.35 (highest since November). Brent crude closed at $72.73 (+2.2%) on elevated Iran risk premium.
Iran: Geneva Round 3 concluded without a deal. Iran rejected demands to halt enrichment, dismantle Fordow/Natanz/Isfahan, and transfer its 10,000kg uranium stockpile abroad. Omani FM reported "significant progress." Technical talks continue in Vienna next week at IAEA headquarters. USS Gerald Ford deployed to the eastern Mediterranean. Secretary Rubio travels to Israel March 2-3. Military option remains on the table.
Week in review: DXY dipped to a low of 97.36 on Monday after the SCOTUS tariff ruling, rallied to 98.00 on Tuesday (SOTU), tested 98.00 again Wednesday, and has now faded to 97.60. Four tests of 98.00, four failures to hold. The week closes with the dollar down 0.19% from Friday's prior close.