As mentioned above, one of the markets that has reacted most positively to the reassessment of expectations over US Federal Reserve’s probable rate cut path this year is the US dollar. Following Wednesday’s hotter-than-expected US CPI numbers, the Dollar Index has rallied over 1.7% in a straight line. It is currently trading at its highest level in five months. These gains have been helped along by the sharp jump in bond yields as investors now expect only 50 basis points-worth of rate cuts this year, down from 150 a couple of months ago. Despite this, and proving wrong all those who believe that gold and the dollar are negatively correlated, precious metals have soared. Despite a brief sell-off on Wednesday afternoon, the rally in both gold and silver has been relentless. And that rally stepped up another gear this afternoon. Gold has now risen by 22% in the last two months, having broken above $2,400 for the first time in history. Silver has now jumped 35% over the same period. Silver is now testing levels hit in August 2020 and February in 2021. Time for a breather? You would certainly think so. But all pull-backs have been remarkably shallow so far, which is par for the course in a bull market.