Market Drivers: Assets Dance to CPI Data, US-China Trade Talks

Markets buzzed with activity on June 11, 2025, as assets like gold, silver, and the Canadian Dollar reacted to a softer-than-expected US Consumer Price Index (CPI) report and progress in US-China trade talks. The cooling inflation figures sparked hopes for Federal Reserve rate cuts, while a tentative trade framework eased global tensions, influencing asset prices in distinct ways. How are these factors shaping the performance of various assets, and what lies ahead?

US Inflation Softens, Stirring Asset Moves

The US CPI data for May, released on June 11, revealed headline inflation at 2.4% year-over-year, below the anticipated 2.5%, with core CPI steady at 2.8%. This softer print weakened the US Dollar Index (DXY) by 0.44% to 98.61 and pushed US 10-year Treasury yields down to 4.42%. Markets now see a 70% chance of a Fed rate cut by September, per the CME’s FedWatch Tool, boosting non-yielding assets like gold, which climbed to $3,327 after touching $3,360. Silver (XAG/USD), however, slipped from a 13-year high of $37.00 to $36.50, reflecting profit-taking in overbought territory. The Canadian Dollar (CAD) held near eight-month highs against the USD, with USD/CAD below 1.3700, buoyed by the Greenback’s retreat.

Trade Talks Spark Optimism, Mixed Reactions

A US-China trade framework, announced after London talks, lifted market sentiment by addressing Chinese export curbs on rare earth minerals. Pending approval from President Donald Trump and President Xi Jinping, the deal sets US tariffs at 55% and China’s at 10%. This progress reduced safe-haven demand, pressuring silver prices, while gold held steady due to its dual role as a safe-haven and inflation hedge. The Canadian Dollar benefited indirectly, as eased trade tensions signal stability for Canada’s export-driven economy. Equity markets also reacted, with the Dow Jones Industrial Average breaching 43,000, reflecting broader optimism.

Technical Outlook Across Assets

Gold’s bullish bias persists, but consolidation below $3,400 suggests caution, with support at $3,269 and resistance at $3,450. Silver’s retreat to $36.50, with RSI signaling overbought conditions, points to potential support at $35.90. USD/CAD remains oversold, hinting at a possible pullback to 1.3750 if momentum fades. These technical patterns reflect assets grappling with mixed signals from inflation and trade developments, setting the stage for volatility.

What’s Next for Markets?

The interplay of US inflation and trade talks will continue to drive asset performance. Thursday’s Producer Price Index (PPI), expected to hold at 3.1% year-over-year, and upcoming US jobs data could either reinforce rate cut bets or highlight persistent inflation, impacting gold and silver. For the Canadian Dollar, a sparse domestic data calendar shifts focus to US indicators and trade deal progress. While the trade framework offers hope, delays in approvals could revive safe-haven demand, lifting gold and silver. Assets remain at a crossroads, with US data and global trade dynamics dictating their next moves. Investors brace for a dynamic ride as these forces unfold.