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Brent remains under pressure below its 50-day moving average near $63, with prices drifting toward key support at $58.40 and risks skewed to a deeper extension of the downtrend if this level fails, Société Générale's FX analysts note. Downtrend momentum persists"Brent has struggled to break above the 50-DMA (currently near $63) since October, leading to a steady decline. It is now approaching the April/May lows around $58.40, which may act as an interim support. However, there are no clear signals of a meaningful rebound yet." "The moving average near $63 is likely to cap short-term upside. Failure to hold $58.40 is likely to extend the downtrend toward the next projections at $56 and $54/53."

Korea’s 2026 macro outlook is likely to be driven more by domestic demand than in 2025. However, external financial conditions could pose a barrier to domestic performance. Financial stability concerns are likely to limit monetary and fiscal policy flexibility. The government’s role in risk management will be important to contain chronic financial issues, Standard Chartered's economist Chong Hoon Park reports. A more balanced growth profile"Korea’s 2026 economic outlook points to a more balanced growth profile compared to 2025, when activity was largely driven by exports and the global semiconductor cycle. We expect domestic demand to contribute more meaningfully to growth, alongside continued export performance, reflecting a likely cyclical recovery in consumption and construction investment. Exports – particularly AI-related outbound investment and semiconductor shipments – will remain an important stabiliser, but no longer the dominant growth engine, in our view.""We forecast c.2.0% GDP growth in 2026, improving from our estimated 1.0% in 2025. Private consumption should recover gradually, supported by wealth effects from a firmer equity market and easing negative base effects on real incomes. Construction investment is likely to rebound following a prolonged contraction, reflecting the fading of unusually strong negative base effects rather than a renewed structural upswing. As such, we expect the recovery to remain cyclical rather than structural. Exports should continue to support growth, but their incremental contribution may moderate given strong base effects from 2025. This should allow domestic demand to play a larger role in the growth mix, likely resulting in more balanced expansion than in recent years.""However, this outlook might unfold within a demanding global financial environment, defined by three forces: persistent US inflation, ongoing global fiscal expansion, and continued competition for global USD liquidity. While we do not think these factors will overturn Korea’s balanced-growth narrative, they could shape the financial conditions under which the economic recovery proceeds, and constrain policy flexibility."

EUR/USD has stalled near 1.1800, with heavy option expiries likely to keep the pair range-bound as markets await potential direction from this week’s ECB meeting, ING's FX analyst Chris Turner notes.ECB meeting poses event risk"EUR/USD briefly touched our long-standing year-end target at 1.1800 yesterday and has since receded. We note that approximately $10bn worth of option expiries are due to fall over the next week, with strike levels between 1.1750 and 1.1800. This suggests EUR/USD could hang around these levels for a while." "As mentioned yesterday, the supply-driven fall in energy prices is good news for the euro, but EUR/USD will face some event risk in the form of Thursday's ECB meeting. Here the hawkish comments from the ECB's Isabel Schabel really reverberated through FX and rates markets last week." "Should she be exposed as a hawkish outlier on Thursday and eurozone growth forecasts be revised insufficiently higher, then the euro could get hit."

.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}USD/CAD could find primary support at the four-month low of 1.3721.The 14-day RSI at 33 stays below its midline, rebounding from oversold levels but limiting upside momentum.The pair tests the upper descending wedge boundary near 1.3790, followed by the 1.3800.USD/CAD gains ground after registering modest losses in the previous session, trading around 1.3780 during the European hours on Wednesday. The daily chart suggests a potential upside breakout, with falling, converging trendlines forming a bullish descending wedge pattern.However, the USD/CAD pair stays under the descending nine-day Exponential Moving Average (EMA) and the 50-day EMA, reinforcing a bearish bias. The short-term average remains below the 50-day EMA, keeping sellers in control.Moving averages slope lower, and price action remains capped by the nine-day EMA, signaling a persistent downtrend. A recovery through the short-term average could trigger a corrective bounce. The 14-day Relative Strength Index (RSI) at 33 remains below its midline after rebounding from oversold but capping upside momentum.The initial support appears at the four-month low of 1.3721, followed by the lower boundary of the descending wedge around 1.3710. Further support lies at the psychological level of 1.3700. A break below this level would put downward pressure on the USD/CAD pair to navigate the region around 1.3539, the lowest level since October 2024.On the upside, the USD/CAD pair tests the upper descending wedge boundary around 1.3790, followed by the psychological level of 1.3800 and the nine-day EMA at 1.3811. A break above this confluence resistance zone could trigger a rebound and support the pair to target the 50-day EMA at 1.3928. Further barrier lies at the three-week high of 1.4014.USD/CAD: Daily Chart Canadian Dollar Price Today The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the weakest against the US Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD 0.25% 0.74% 0.45% 0.15% 0.20% 0.19% 0.32% EUR -0.25% 0.50% 0.18% -0.10% -0.05% -0.06% 0.07% GBP -0.74% -0.50% -0.29% -0.60% -0.54% -0.55% -0.42% JPY -0.45% -0.18% 0.29% -0.30% -0.25% -0.27% -0.13% CAD -0.15% 0.10% 0.60% 0.30% 0.05% 0.04% 0.17% AUD -0.20% 0.05% 0.54% 0.25% -0.05% -0.01% 0.12% NZD -0.19% 0.06% 0.55% 0.27% -0.04% 0.00% 0.13% CHF -0.32% -0.07% 0.42% 0.13% -0.17% -0.12% -0.13% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).(The technical analysis of this story was written with the help of an AI tool.)

Oil prices slid sharply as surplus fears intensified, pushing Brent below $60 per barrel, though supply risks and falling US Crude inventories offered limited near-term support, ING's commodity experts Ewa Manthey and Warren Patterson note.US Crude stocks fall sharply"The Oil market sell-off accelerated yesterday. ICE Brent is settling 2.7% lower, breaking below US$60/bbl to its lowest level since February 2021. This pressure comes from a growing surplus outlook. Hopes for a Russia-Ukraine ceasefire will undoubtedly add to the downward pressure. As our Oil balance shows, the peak of the surplus is expected in the first quarter of 2026. However, with every quarter of next year in surplus, inventories should grow throughout 2026, putting further pressure on Oil prices.""There are clear supply risks to our view. Russian risks are well telegraphed, but there are clear risks to the Venezuelan Oil supply. Oil prices have bounced higher in early-morning trading today (WTI up around 1.3% at the time of writing), after President Trump ordered a blockade of sanctioned Oil tankers entering and leaving Venezuela. This follows the US seizing an Oil tanker off the coast of Venezuela last week. Venezuela exported around 600k b/d of Oil in November. It’s likely that these volumes will fall given the latest developments. The bulk of this Oil is shipped to China.""American Petroleum Institute (API) inventory numbers released overnight were also supportive of the market. US Crude Oil inventories are reported to have fallen by 9.3m barrels over the last week. Meanwhile, refined product inventory changes were more bearish, with gasoline and distillate fuel Oil stocks increasing by 4.8m barrels and 2.5m barrels, respectively."

.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a} .fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Euro pulls back from 1.1800 highs against the US Dollar and nears 1.1700.US labour data keeps hopes of further Fed monetary easing alive.EUR/USD is correcting lower as the focus shifts to the ECB's monetary policy.EUR/USD is pulling back from nearly three-month highs above 1.1800, trading at 1.1710 at the time of writing, as the US Dollar (USD) regains lost ground. The Greenback fell after the release of a backlog of delayed US labour figures on Tuesday, but is picking up on Wednesday, with investors pondering the Federal Reserve's (Fed) next monetary policy steps.Data released by the US Bureau of Labor Statistics revealed that employment fell sharply in October before increasing more than expected in November, while the Unemployment Rate in November increased to a four-year high, and wage growth moderated. These figures should be taken with caution, as the US government shutdown might have distorted the data. However, the big picture continues to show a stalled labor market, which maintains investors' hopes of a March interest rate cut by the Fed intact, as shown by the CME Group Fedwatch tool.In the economic calendar on Wednesday, the final reading of the Eurozone's Harmonized Index of Consumer Prices is unlikely to trigger any significant volatility, as markets await the outcome of the European Central Bank's monetary policy meeting and US consumer Inflation figures, both due on Thursday. Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the British Pound. USD EUR GBP JPY CAD AUD NZD CHF USD 0.33% 0.59% 0.39% 0.17% 0.27% 0.30% 0.32% EUR -0.33% 0.28% 0.07% -0.13% -0.07% -0.03% -0.01% GBP -0.59% -0.28% -0.21% -0.42% -0.32% -0.31% -0.27% JPY -0.39% -0.07% 0.21% -0.22% -0.12% -0.09% -0.07% CAD -0.17% 0.13% 0.42% 0.22% 0.10% 0.12% 0.15% AUD -0.27% 0.07% 0.32% 0.12% -0.10% 0.03% 0.05% NZD -0.30% 0.03% 0.31% 0.09% -0.12% -0.03% 0.02% CHF -0.32% 0.01% 0.27% 0.07% -0.15% -0.05% -0.02% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote). Daily Digest Market Movers: Euro corrects lower ahead of the ECB meetingThe Euro (EUR) is correcting lower with investors awaiting the conclusion of the ECB's monetary policy meeting due on Thursday. The bank is widely expected to keep interest rates on hold, and investors will be looking for confirmation that the monetary easing cycle has come to an end.In the US on Tuesday, delayed Nonfarm Payrolls data showed a 105,000 net decline in employment in October and a 64,000 increase in November, this last beating expectations of a 50K increment. The Unemployment Rate, on the other hand, increased to 4.6%, from 4.4% in September, and wage growth moderated to a 3.5% year-on-year rate in November from 3.7% in October.Also on Tuesday, data from the US Commerce Department revealed that Retail Sales stalled in October, following a 0.1% increase in September, and against market expectations of another 0.1% rise. Excluding automobiles, sales of all other products rose 0.4% MoM.In the Eurozone, preliminary business activity data disappointed. The preliminary HCOB Manufacturing PMI eased to 49.2 in December from 49.6 in the previous month, and Services activity slowed down to 52.6 from 53.6 in November.On Wednesday's economic calendar, the Eurozone's HICP is expected to confirm the preliminary figures showing that inflation contracted 0.3% in November and accelerated to a 2.2% year-on-year pace, from 2.1% in October. In the US, the focus will be on the speeches from Fed Governor Christopher Waller, New York Fed President John Williams, and Atlanta Fed President Raphael Bostic, which might give further hints about the central bank's monetary policy plans.Technical Analysis: EUR/USD bears focus on 1.1685EUR/USD 4-Hour Chart

The EUR/USD pair has been rejected at the 1.1800 and is going through a bearish correction, with sellers targeting the 1.1685 area, where the December 11 low meets the trendline support from November 20 lows.

The 4-hour Relative Strength Index (RSI) has dropped below the 50 level, and the Moving Average Convergence Divergence (MACD) indicator has turned sharply lower after crossing below the signal line, which highlights a growing negative momentum.The mentioned 1.1685 level is a key support to maintain the broader bullish trend intact. A confirmation below here would clear the path towards the December 9 low, at 1.1615, ahead of the December 1 and 2 lows, near 1.1590. To the upside, the pair should return above the broken support around 1.1720 (December 12 low) to shift the focus towards Tuesday's high, near 1.1800, and the September 23 and 24 highs, near 1.1820. Euro FAQs What is the Euro? The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Pound Sterling falls sharply against its major peers after the release of soft UK CPI data for November.Soft UK inflation data and employment concerns pave the way for a BoE interest rate cut on Thursday.The US Dollar bounces back despite weakening job market conditions.The Pound Sterling (GBP) faces intense selling pressure against its major currency peers on Wednesday and slides over 0.5% to near 1.3340 against the US Dollar (USD), following the release of the United Kingdom (UK) Consumer Price Index (CPI) data for November.The Office for National Statistics (ONS) reports that the headline CPI inflation grew at an annualized pace of 3.2%, slower than estimates of 3.5% and the October reading of 3.6%. This is the second straight month in which headline inflation has grown at a slower pace after remaining stable at 3.8% in the July-September period, bolstering hopes that price pressures are on track to return to the desired rate of 2%.In the same period, the core CPI – which excludes volatile components of food, energy, alcohol, and tobacco – rose at a moderate pace of 3.2%, compared to expectations and the previous release of 3.4%.Month-on-month headline inflation deflated by 0.2%, while it was expected to remain flat after rising 0.4% in October. Inflation in the services sector, which is closely tracked by Bank of England (BoE) officials, decelerated to 4.4% from the prior reading of 4.5%.This week, the UK’s employment data for the three months ending in October came in weaker than projected. In the period, the ILO Unemployment Rate rose to 5.1%, the highest reading in almost five years.The overall data showing cooling inflationary pressures and rising labor market concerns strengthen hopes of an interest rate cut by the BoE at its monetary policy meeting on Thursday.Daily digest market movers: Pound Sterling retraces sharply against US DollarThe Pound Sterling corrects sharply to near 1.3340 against the US Dollar (USD) during Wednesday’s European session after revisiting the two-month high above 1.3450 the preivious day. The GBP/USD pair has come under pressure due to a higher-than-projected slowdown in the UK inflation data and a decent recovery move in the US Dollar.At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.4% higher to near 98.60. The DXY recovered sharply on Tuesday after posting a fresh 10-week low near 98.00, following the release of the United States (US) Nonfarm Payrolls (NFP) combined report for October and November.The US Dollar attracted significant bids even as the US NFP report showed that the Unemployment Rate rose to 4.6% in November, the highest figure seen since September 2021. The report also showed that the economy added 64K fresh workers in November after shedding 105K jobs in October.Theoretically, rising US labor market concerns lead to a surge in market expectations for interest rate cuts by the Federal Reserve (Fed). However, there has not been a notable change in the Fed’s dovish expectations as market experts believe that the overall data was distorted by the historically longest US government shutdown in that period.Currently, the CME FedWatch tool shows that the Fed will hold interest rates steady in the 3.50%-3.75% range in its monetary policy meeting in January.Going forward, investors will focus on the US Consumer Price Index (CPI) data for November, which will be released on Thursday. The inflation data will significantly influence market expectations for the Fed’s monetary policy outlook, as officials have expressed that further interest rate cuts could prompt price pressures, which have remained well above the 2% target for a long period."Moving monetary policy near or into accommodative territory, which further Federal Funds Rate cuts will do, risks exacerbating already elevated inflation and untethering the inflation expectations of businesses and consumers," Atlanta Fed Bank President Raphael Bostic wrote in an essay published by the Atlanta Fed, adding that "That is not a risk I would choose to take right now,"Technical Analysis: GBP/USD keeps upward bias amid easing bullish momentumGBP/USD declines to near 1.3340 on Wednesday. Still, the short-term bias of the pair remains upward as the price holds above an ascending 20-day Exponential Moving Average (EMA), currently at 1.3305. The 14-day Relative Strength Index (RSI) falls to 56 after failing to reach overbought conditions, suggesting signs of a bearish reversal.Measured from the 1.3791 high to the 1.3008 low, the 50% Fibonacci retracement at 1.3399 acts as immediate resistance. A daily closing below the 38.2% retracement at 1.3307 could weaken the overall tone and pave the way for further downside towards the 23.6% Fibonacci retracement around 1.3200.Looking up, a sustained closing above Tuesday's high at 1.3456 would open the door towards the psychological level of 1.3500.(The technical analysis of this story was written with the help of an AI tool.) Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-event-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-event-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-event-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-event-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:12px}.fxs-event-module-section:last-child{border:none;margin-bottom:0}.fxs-event-module-header{color:#1b1c23;font-weight:700;font-size:16px;font-style:normal;line-height:20px;margin:0;padding:4px 0;background-color:#fff;border:none;position:relative;padding-right:32px}.fxs-event-module-header label{cursor:pointer;display:block}.fxs-event-module-header label:after,.fxs-event-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-event-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-event-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-event-module-container input[type=checkbox]{display:none}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-header label:after{transform:rotate(45deg) translateX(4px)}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-event-module-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0;margin-top:8px}.fxs-event-module-content.why-matters{max-height:0;overflow:hidden;transition:all .3s ease-in-out}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-content.why-matters{max-height:1000px;margin-top:8px}.fxs-event-module-calendar-title{color:#1b1c23;font-size:17.6px;font-family:Roboto;font-style:normal;font-weight:700;line-height:20.8px;margin:4px 0 0 0}.fxs-event-module-calendar-title-description-wrapper{display:flex;flex-direction:column;gap:12px;border-bottom:1px solid #ececf1;padding-bottom:16px;margin-bottom:16px}.fxs-event-module-inner-calendar{padding:16px}.fxs-event-module-inner-calendar .fxs-event-module-section{padding:0}.fxs-event-module-inner-calendar .fxs-event-module-header{font-size:12.8px;line-height:17px}.fxs-event-module-read-more{display:flex;align-items:center;align-content:center;gap:4px;color:#e4871b;font-size:12.8px;font-family:Roboto;font-style:normal;font-weight:700;line-height:17px;text-decoration:none}.fxs-event-module-read-more svg{width:16px;height:16px}.fxs-event-module-read-more:hover span{text-decoration:underline}.fxs-event-module-release{margin:0;display:flex;flex-direction:column;gap:2px}.fxs-event-module-release>p{font-size:12.8px;font-family:Roboto;font-style:normal;line-height:17px;margin:0}.fxs-event-module-release>p>strong{color:#8c8d91;font-weight:700}.fxs-event-module-release>p>span{color:#8c8d91;font-weight:400}.fxs-event-module-release>p>a{color:#e4871b;font-weight:700;text-decoration:none}.fxs-event-module-release>p>a:hover>span{text-decoration:underline}.fxs-event-module-inner-calendar .fxs-event-module-container{margin:16px 0 0 0;border-top:1px solid #ececf1;padding:12px 0 0 0}@media (min-width:680px){.fxs-event-module-inner-calendar .fxs-event-module-header{font-size:14.72px;line-height:20px}.fxs-event-module-release p{font-size:14.72px;line-height:20px}.fxs-event-module-read-more{font-size:14.72px;line-height:20px}.fxs-event-module-calendar-title{font-size:22.4px;line-height:25.6px}.fxs-event-module-title{font-size:19.2px;line-height:27.2px}.fxs-event-module-header{font-size:19.2px;line-height:25.92px}.fxs-event-module-content{font-size:16px;line-height:21.6px}}EUR/GBP appreciates following the release of weaker UK Consumer Price Index data.UK headline CPI rose 3.2% YoY in November, below forecasts but above the BoE’s 2% target.Traders shift their focus toward Germany’s IFO Business Survey and Eurozone core HICP data due later in the day.EUR/GBP recovers its recent losses from the previous session, trading around 0.8780 during the European hours on Wednesday. The currency cross gains ground as the Pound Sterling (GBP) declines following the release of weaker Consumer Price Index (CPI) data from the United Kingdom (UK) for November.The UK headline CPI rose 3.2% year-over-year (YoY) in November, above the Bank of England’s (BoE) 2% inflation target. Markets predicted a 3.5% growth in the reported period against the rise of 3.6% in October. Meanwhile, the monthly UK CPI arrived at -0.2% in November, versus a rise of 0.4% reported in October.The UK core CPI (excluding volatile food and energy items) rose 3.2% year-over-year (YoY) in the same period, compared to October’s 3.4% print and came in softer than the forecast of 3.4%. The annual Retail Price Index came in at 3.8% in November, against the expected and previous reading of 4.3%.Weaker data reinforced the dovish expectations that the Bank of England (BoE) will cut interest rates by 25 basis points to 3.75%, the lowest since 2022, as rising unemployment and economic stagnation ease inflation pressures.Traders will likely watch Germany’s IFO Business Survey, followed by Eurozone core HICP data later in the day. The Euro (EUR) gains ground as investors scale back European Central Bank (ECB) easing expectations after officials signaled further cuts may not be needed in 2026. Economic Indicator Consumer Price Index (YoY) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish. Read more. Last release: Wed Dec 17, 2025 07:00 Frequency: Monthly Actual: 3.2% Consensus: 3.5% Previous: 3.6% Source: Office for National Statistics Why it matters to traders? The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} The German IFO Survey OverviewGermany’s IFO institute will publish its business survey for December on Wednesday at 09:00 GMT.The headline IFO Business Climate Index is expected to tick higher to 88.2 this month, from a 88.1 reading in November.The Current Assessment Index is forecast to edge up to 85.7 in December from 85.6, while the Expectations Index is seen easing to 90.5 from 90.6.How could the German IFO Survey affect EUR/USD?EUR/USD may limit its downside if the IFO Business Survey data comes out as expected. The Euro may gain if data comes stronger-than-expected, which could reinforce cautious sentiment after European Central Bank (ECB) officials signaled cuts may not be needed in 2026. Traders will likely observe the Eurozone Core Harmonized Index of Consumer Prices (HICP) data later in the day.The EUR/USD pair may remain subdued as the US Dollar (USD) rises after mixed US labor market data for November did little to reinforce expectations of additional Federal Reserve rate cuts. The CME FedWatch tool suggests that Fed funds futures are pricing an implied 75.6% chance of a hold in rates at the US central bank's next meeting in January, up from nearly 74% a week ago.Technically, the EUR/USD trades lower around 1.1710 at the time of writing. However, the bullish bias prevails as the pair remains within the ascending channel pattern. Additionally, the 14-day Relative Strength Index (RSI) is positioned above the 50 level, strengthening the bullish bias. The pair may approach the 12-month high of 1.1804, reached on December 16. On the downside, the immediate support lies at the nine-day Exponential Moving Average (EMA) of 1.1702, aligned with the psychological level of 1.1700. Further declines would lead the pair to test the 50-day EMA at 1.1636. Euro FAQs What is the Euro? The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-event-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-event-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-event-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-event-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:12px}.fxs-event-module-section:last-child{border:none;margin-bottom:0}.fxs-event-module-header{color:#1b1c23;font-weight:700;font-size:16px;font-style:normal;line-height:20px;margin:0;padding:4px 0;background-color:#fff;border:none;position:relative;padding-right:32px}.fxs-event-module-header label{cursor:pointer;display:block}.fxs-event-module-header label:after,.fxs-event-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-event-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-event-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-event-module-container input[type=checkbox]{display:none}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-header label:after{transform:rotate(45deg) translateX(4px)}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-event-module-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0;margin-top:8px}.fxs-event-module-content.why-matters{max-height:0;overflow:hidden;transition:all .3s ease-in-out}.fxs-event-module-container input[type=checkbox]:checked+.fxs-event-module-section .fxs-event-module-content.why-matters{max-height:1000px;margin-top:8px}.fxs-event-module-calendar-title{color:#1b1c23;font-size:17.6px;font-family:Roboto;font-style:normal;font-weight:700;line-height:20.8px;margin:4px 0 0 0}.fxs-event-module-calendar-title-description-wrapper{display:flex;flex-direction:column;gap:12px;border-bottom:1px solid #ececf1;padding-bottom:16px;margin-bottom:16px}.fxs-event-module-inner-calendar{padding:16px}.fxs-event-module-inner-calendar .fxs-event-module-section{padding:0}.fxs-event-module-inner-calendar .fxs-event-module-header{font-size:12.8px;line-height:17px}.fxs-event-module-read-more{display:flex;align-items:center;align-content:center;gap:4px;color:#e4871b;font-size:12.8px;font-family:Roboto;font-style:normal;font-weight:700;line-height:17px;text-decoration:none}.fxs-event-module-read-more svg{width:16px;height:16px}.fxs-event-module-read-more:hover span{text-decoration:underline}.fxs-event-module-release{margin:0;display:flex;flex-direction:column;gap:2px}.fxs-event-module-release>p{font-size:12.8px;font-family:Roboto;font-style:normal;line-height:17px;margin:0}.fxs-event-module-release>p>strong{color:#8c8d91;font-weight:700}.fxs-event-module-release>p>span{color:#8c8d91;font-weight:400}.fxs-event-module-release>p>a{color:#e4871b;font-weight:700;text-decoration:none}.fxs-event-module-release>p>a:hover>span{text-decoration:underline}.fxs-event-module-inner-calendar .fxs-event-module-container{margin:16px 0 0 0;border-top:1px solid #ececf1;padding:12px 0 0 0}@media (min-width:680px){.fxs-event-module-inner-calendar .fxs-event-module-header{font-size:14.72px;line-height:20px}.fxs-event-module-release p{font-size:14.72px;line-height:20px}.fxs-event-module-read-more{font-size:14.72px;line-height:20px}.fxs-event-module-calendar-title{font-size:22.4px;line-height:25.6px}.fxs-event-module-title{font-size:19.2px;line-height:27.2px}.fxs-event-module-header{font-size:19.2px;line-height:25.92px}.fxs-event-module-content{font-size:16px;line-height:21.6px}}GBP/JPY attracts some intraday sellers in reaction to softer UK inflation figures.The divergent BoE-BoJ policy expectations back the case for further depreciation.Traders seem reluctant to place aggressive bets ahead of central bank event risks.The GBP/JPY cross meets with some supply following an intraday uptick to the 208.00 neighborhood on Wednesday in reaction to softer UK inflation figures. Spot prices drop to a fresh daily low, around the 207.30 area during the early European session and for now, seem to have stalled the previous day's recovery move from an over one-week low.The UK Office for National Statistics (ONS) reported that the headline Consumer Price Index (CPI) rose 3.2% over the year in November, marking a notable slowdown from 3.6% in October and missing expectations for a reading of 3.5%. Adding to this, the core gauge, which excludes volatile food and energy items, climbed 3.2% YoY during the reported month, compared to consensus estimates and October's 3.4% print. The data reaffirms market bets that the Bank of England (BoE) will cut interest rates on Thursday, which, in turn, weighs on the British Pound (GBP) and exerts some downward pressure on the GBP/JPY cross.The Japanese Yen's (JPY) relative outperformance could further be attributed to the growing acceptance of an imminent rate hike by the Bank of Japan (BoJ) at the end of a two-day policy meeting on Friday. The bets were lifted by BoJ Governor Kazuo Ueda's comments last week, saying that the likelihood of the central bank's baseline economic and price outlook materialising had been gradually increasing. Ueda added that the BoJ is getting closer to attaining its inflation target, backing the case for further policy normalization. Apart from this, a weaker tone around the equity markets is seen as another factor benefiting the safe-haven JPY.The aforementioned fundamental backdrop suggests that the path of least resistance for the GBP/JPY cross is to the downside. Traders, however, might refrain from placing aggressive bets and opt to wait on the sidelines ahead of the key central bank event risks – the BoE rate decision on Thursday and the latest BoJ policy update on Friday. The latter will play a key role in influencing the near-term JPY price dynamics amid concerns about Japan's deteriorating fiscal condition on the back of Prime Minister Sanae Takaichi's massive spending plan and help in determining the next leg of a directional move for the currency pair. Economic Indicator Consumer Price Index (YoY) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish. Read more. Last release: Wed Dec 17, 2025 07:00 Frequency: Monthly Actual: 3.2% Consensus: 3.5% Previous: 3.6% Source: Office for National Statistics Why it matters to traders? The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} Japanese Prime Minister Sanae Takaichi on Wednesday emphasized the need for proactive fiscal policy to strengthen Japan's capabilities, rather than excessive fiscal tightening.Key quotesWhat's necessary for Japan now is to strengthen its capacity with proactive fiscal policy, not excessive fiscal tightening. 

We will achieve sustainable fiscal policy, social welfare system by reflating economy, improving corporate profits, increase household income via wage gains that then boosts tax revenues. 

What we foresee is strategic fiscal spending, not reckless expansion. Elsewhere, former BoJ deputy governor, Masazumi Wakatabe stated that Japan must raise neutral rate of interest via fiscal policy, growth strategy.Neutral interest rate will rise if demand for funds increase. 

If Japan's neutral rate rises as a result of fiscal policy, growth strategy, it would be natural for BoJ to raise interest rates. 

BoJ should avoid premature rate hike, excessive adjustment of monetary support in light of neutral rate level. 

Sanaenomics carries over elements of abenomics but focuses more on strengthening supply side of economy. Market reactionThe USD/JPY pair is gaining 0.24% on the day to trade at 155.17 at the press time. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a} .fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} Here is what you need to know on Wednesday, December 17:The US Dollar (USD) holds its ground early Wednesday as markets reassess the Federal Reserve (Fed) policy outlook after the employment data. In the early European session, November inflation data from the UK will be watched closely by market participants ahead of the Bank of England's (BoE) policy announcements due Thursday. US Dollar Price This week The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the weakest against the Japanese Yen. USD EUR GBP JPY CAD AUD NZD CHF USD 0.08% -0.06% -0.45% 0.03% 0.43% 0.40% 0.05% EUR -0.08% -0.14% -0.55% -0.06% 0.37% 0.32% -0.02% GBP 0.06% 0.14% -0.27% 0.08% 0.51% 0.46% 0.09% JPY 0.45% 0.55% 0.27% 0.49% 0.89% 0.84% 0.70% CAD -0.03% 0.06% -0.08% -0.49% 0.41% 0.38% 0.13% AUD -0.43% -0.37% -0.51% -0.89% -0.41% -0.05% -0.40% NZD -0.40% -0.32% -0.46% -0.84% -0.38% 0.05% -0.37% CHF -0.05% 0.02% -0.09% -0.70% -0.13% 0.40% 0.37% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote). On Tuesday, the US Bureau of Labor Statistics (BLS) released its official employment report for the first time since the US government reopened. The publication showed that Nonfarm Payrolls declined by 105,000 in October and rose by 64,000 in November. The Unemployment Rate in November edged higher to 4.6% from 4.4%, while the annual wage inflation softened to 3.5% from 3.7% in this period. The USD Index declined to its lowest level since early October below 98.00 with the initial reaction before recovering a large portion of its losses later in the American session. Early Wednesday, the USD Index rises toward 98.50. In the second half of the day, several Fed policymakers will be delivering speeches.After rising more than 0.3% on Tuesday, GBP/USD reversed its direction early Wednesday and declined below 1.3400. Annual inflation in the UK, as measured by the change in the Consumer Price Index (CPI), is forecast to soften to 3.5% in November from 3.6% in October.EUR/USD climbed above 1.1800 for the first time since late September on Tuesday but lost its bullish momentum. The pair corrects lower and trades below 1.1750 in the European morning on Wednesday. Later in the session, IFO business sentiment data from Germany will be featured in the European economic calendar. Additionally, Eurostat will release revisions to November inflation data. On Thursday, the European Central Bank (ECB) will announce rate decisions and publish the revised macroeconomic projections.USD/JPY closed the second consecutive day in negative territory on Tuesday before staging a rebound. At the time of press, the pair was up 0.3% on the day at 155.15.After failing to find direction on Tuesday, Gold gains traction early Wednesday and gains about 0.7% on the day near $4,330. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}USD/CHF edges higher to 0.7960 in Wednesday’s early European session. A surge in the US Unemployment Rate kept pressure on the Fed to rescue the labor market by cutting interest rates.Uncertainty and risk-off sentiment could boost the safe-haven asset like the Swiss Franc. The USD/CHF pair trades in positive territory around 0.7960 during the early European session on Wednesday, bolstered by a rebound in the US Dollar (USD). However, the prospect of the US Federal Reserve (Fed) interest rate cut next year could weigh on the Greenback against the Swiss Franc (CHF). The Swiss National Bank (SNB) Quarterly Bulletin for the fourth quarter is due later in the day. Also, New York Fed President John Williams and Atlanta Fed President Raphael Bostic are set to speak. Data released on Tuesday showed the labor market remained soft, leaving investors on edge about when the next rate cut is likely to come. The US Nonfarm Payrolls (NFP) rose by 64,000 in November, compared to a fall of 105,000 in October. This figure came in better than the estimates of 50,000. Meanwhile, the Unemployment Rate in the US climbed to 4.6% in November from 4.4% in October.Fed officials are split over whether more easing of monetary policy is needed next year. The median Fed official penciled in just one reduction in 2026, but some policymakers see no further cuts. Uncertainty and the risk of US military action in Venezuela could boost the safe-haven flows, supporting the Swiss Franc. Late Tuesday, US President Donald Trump ordered a blockade of all sanctioned oil tankers entering and leaving Venezuela, per Reuters. His action came after the Trump administration detained a supertanker last week, and Washington has ordered a huge buildup of US military forces off the Venezuelan coast in an operation said to target drug smuggling. Swiss Franc FAQs What key factors drive the Swiss Franc? The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone. Why is the Swiss Franc considered a safe-haven currency? The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in. How do decisions of the Swiss National Bank impact the Swiss Franc? The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF. How does economic data influence the value of the Swiss Franc? Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate. How does the Eurozone monetary policy affect the Swiss Franc? As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} The UK CPI OverviewThe United Kingdom (UK) Office for National Statistics (ONS) will publish the highly relevant Consumer Price Index (CPI) data for November on Wednesday at 07:00 GMT.The UK headline Consumer Price Index is forecast to have eased to a 3.5% year-over-year (YoY) in November from the 3.6% seen in October. Meanwhile, Monthly inflation is expected to be flat at 0% after rising 0.4% in October.The UK core CPI, considered more relevant for the central bank, as it strips off the seasonal impact of food and energy prices, is expected to remain consistent at a 3.4% YoY rise in November.How could the UK CPI affect GBP/USD?GBP/USD is likely to stay subdued if UK CPI meets expectations. However, any upside surprise could cap losses by tempering dovish sentiment ahead of the Bank of England’s (BoE) policy decision on Thursday. The BoE is widely expected to cut rates by 25 basis points to 3.75%, the lowest since 2022, as rising unemployment and economic stagnation ease inflation pressures. Traders will also observe UK Retail Sales and PPI Core Output data.The GBP/USD pair struggles as the US Dollar (USD) advances after mixed US labor market data for November did little to reinforce expectations of additional Federal Reserve rate cuts. The CME FedWatch tool suggests that Fed funds futures are pricing an implied 74.4% chance of a hold in rates at the US central bank's next meeting in January, up from nearly 70% a week ago.Technically, the GBP/USD pair is trading around 1.3390 at the time of writing. Daily chart analysis points to a sustained bullish bias, with the pair holding within an ascending channel and the 14-day RSI remaining above 50. The pair may explore the resistance region around the 13-week high of 1.3536. On the downside, the immediate support lies at the nine-day Exponential Moving Average (EMA) of 1.3662, followed by the psychological level of 1.3300, aligned with the 50-day EMA at 1.3295. Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Indian Rupee bounces back from its record lows against the US Dollar, following the RBI’s intervention.FIIs have remained net sellers in seven months so far this year.The Fed is expected to hold interest rates steady in the January 2026 meeting.The Indian Rupee (INR) gains sharply against the US Dollar (USD) in the opening session on Wednesday. The USD/INR pair plunges over 1% to near 90.00 from its all-time high of 91.56 due to the Reserve Bank of India’s (RBI) intervention in the spot and Non-deliverable Forward (NDF) markets.State-run banks were spotted offering US dollars aggressively, most likely on behalf of the RBI, three traders told Reuters.The RBI was expected to intervene to support the domestic currency, which has remained the worst-performing Asian currency against the US Dollar, and is down almost 6.45% so far this year.The continuous outflow of foreign funds from the Indian stock market is due to the absence of a trade announcement between the United States (US) and India. The ongoing US-Indian trade stalemate has also increased demand for US Dollars by Indian importers, resulting in weakness in the Indian Rupee.So far this year, Foreign Institutional Investors (FIIs) have remained net sellers in seven out of 11 months. In December, FIIs have offloaded stake in the Indian equity market worth Rs. 23,455.75 crore.On the monetary policy front, RBI Governor Sanjay Malhotra has stated in an interview with Financial Times (FT) that interest rates will “remain low for a longer period”. Malhotra added that the recent headline Gross Domestic Product (GDP) figure "was surprising", which led the central bank to "improve its forecasting". He further added that the impact of the US-India trade deal could be as much as 0.5% on the overall GDP.Daily digest market movers: US Dollar bounces back after release of key domestic dataThe US Dollar extends its Tuesday’s recovery move during Wednesday’s Asian trading hours, even as weak US data has escalated concerns over the economic outlook. At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.17% higher to near 98.40. The USD Index rebounded on Tuesday after posting a fresh eight-week low near 98.00.On Wednesday, the combined Nonfarm Payrolls (NFP) report for October and November showed that the Unemployment Rate rose to 4.6% lately, the highest figure seen since September 2021. The report also showed that the economy shed 105K jobs in October before creating 64K fresh in November.Apart from the labour market data, Retail Sales data for October and preliminary S&P Global Purchasing Managers’ Index (PMI) data for December remained weak. Month-on-month Retail Sales turned out flat, while they were expected to grow steadily by 0.1%. Meanwhile, flash private sector activity data grew at a moderate pace. The Composite PMI landed at 53.0, sharply lower than 54.2 in November.While the US data has prompted economic concerns, market experts believe that it is unlikely to impact the Federal Reserve’s (Fed) monetary policy expectations, as the data was distorted by the government shutdown.Currently, the CME FedWatch tool shows that the Fed is unlikely to cut interest rates in the January 2026 policy meeting.Going forward, investors will focus on the US Consumer Price Index (CPI) data for November, which will be released on Thursday.Technical Analysis: USD/INR finds cushion near 20-day EMAIn the daily chart, USD/INR trades at 90.5370. Price holds above the rising 20-day Exponential Moving Average (EMA), preserving a bullish bias. The average continues to ascend and now stands at 90.1278. The RSI at 59.23, above the 50 midline, confirms positive momentum after unwinding from recent overbought readings. Initial support is at the 20-EMA at 90.1278; sustained trade above this gauge keeps the topside favored.Trend conditions remain firm, though momentum has moderated as the RSI pulled back from the 70s to 59.23. Pullbacks would remain in check while USD/INR defends the moving-average base, with a support zone across the 20-EMA cluster at 89.9556–89.8364. A daily close below that area would tilt the bias toward consolidation, whereas maintaining bids above it would leave scope for an extension higher.(The technical analysis of this story was written with the help of an AI tool) Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}EUR/USD softens to around 1.1730 in Wednesday’s early European session. The ECB is widely expected to leave interest rates unchanged on Thursday for a fourth consecutive meeting.The major pair keeps the positive picture above the 100-day EMA and bullish RSI momentum despite a pullback. The initial support level emerges at 1.1639; the first upside barrier to watch is 1.1788.The EUR/USD pair declines to around 1.1730 during the early European session on Wednesday, pressured by renewed US Dollar (USD) demand. Nonetheless, the potential downside for the major pair might be limited amid the growing acceptance that the European Central Bank (ECB) is done cutting interest rates. The ECB is expected to hold interest rates steady at its December meeting on Thursday. The central bank has kept its key deposit rate on hold at 2% since July.Across the pond, the mixed US employment report for November showed that the US labor market remains relatively resilient but shows signs of slowing. This, in turn, could drag the Greenback lower and create a tailwind for the major pair. The US Nonfarm Payrolls (NFP) rose by 64,000 in November after falling by 105,000 in October. This figure came in better than the estimates of 50,000. Meanwhile, the Unemployment Rate in the US ticked higher to 4.6% in November from 4.4% in October.
Technical Analysis:In the daily chart, EUR/USD trades at 1.1732. The 100-EMA nudges higher at 1.1611, with price holding above it and sustaining an upward bias. The 20-period average inside the Bollinger bands advances near 1.1639, supporting shallow pullbacks. Price leans toward the upper band, and the bands are widening, indicating firm bullish pressure alongside rising volatility.RSI at 65.58 shows solid bullish momentum while not yet overbought. Immediate resistance stands at the upper Bollinger Band at 1.1788, whereas support is set at the middle band at 1.1639 and the 100-EMA at 1.1611. A break higher could open the door to an extension of the advance, while failure to clear resistance would keep the pair capped and invite a retracement toward support.(The technical analysis of this story was written with the help of an AI tool) ECB FAQs What is the ECB and how does it influence the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. What is Quantitative Easing (QE) and how does it affect the Euro? In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic. What is Quantitative tightening (QT) and how does it affect the Euro? Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} Gold prices rose in India on Wednesday, according to data compiled by FXStreet.The price for Gold stood at 12,552.61 Indian Rupees (INR) per gram, up compared with the INR 12,501.23 it cost on Tuesday.The price for Gold increased to INR 146,404.30 per tola from INR 145,811.80 per tola a day earlier.Unit measureGold Price in INR1 Gram12,552.6110 Grams125,520.20Tola146,404.30Troy Ounce390,413.90FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly. Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up. (An automation tool was used in creating this post.)

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}EUR/JPY may advance as the Japanese Yen weakens following softer Adjusted Merchandise Trade Balance data from Japan.Strong exports boosted BoJ hike expectations, with November growth at 6.1%, the fastest in nine months.Traders will likely watch Germany’s IFO Business Survey, followed by Eurozone core HICP data later in the day.EUR/JPY holds ground after two days of losses, trading around 181.90 during the Asian hours on Wednesday. The currency cross may appreciate as the Japanese Yen (JPY) faces downward pressure after the release of Japan’s Adjusted Merchandise Trade Balance for November, which came in at JPY 62.9 billion surplus, lower than October’s JPY 74.0 billion.However, strong export data reinforced expectations of a Bank of Japan (BoJ) rate hike this week. Exports rose 6.1% in November, beating forecasts of 4.8% and marking the fastest growth in nine months. Core machinery orders surged 7%, defying expectations of a 2.3% decline, while imports increased 1.3% year-on-year, extending a third consecutive monthly gain but missing estimates of 2.5%.Traders become cautious, preferring to wait for the Bank of Japan's policy update before placing new bets. Attention remains focused on the two-day BoJ meeting, concluding on Friday, with investors seeking guidance on the policy path into 2026. BoJ Governor Kazuo Ueda said last week that confidence in the bank’s baseline economic and price outlook is gradually rising, adding that Japan is moving closer to achieving its inflation target.The Euro (EUR) may regain its ground against its major peers as investors pared back expectations for additional European Central Bank (ECB) easing after officials signaled that further cuts may not be necessary in 2026. Traders will likely observe Germany’s IFO Business Survey data, followed by the Eurozone Core Harmonized Index of Consumer Prices (HICP) data later in the day. Euro FAQs What is the Euro? The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The USD is looking to build on the overnight bounce from its lowest level since early October.Dovish Fed expectations might cap gains for the DXY and warrant caution for bullish traders.The technical setup suggests that the path of least resistance for the USD is to the downside.The US Dollar (USD) edges higher during the Asian session on Wednesday and recovers further from its lowest level since early October, around the 97.90-97.85 region, touched the pervious day. The USD Index (DXY), which tracks the Greenback against a basket of currencies, climbs to the 98.30 zone in the last hour, though any meaningful appreciation seems elusive amid dovish Federal Reserve (Fed) expectations.From a technical perspective, the recent failure to build on the momentum beyond the very important 200-day Simple Moving Average (SMA) and a subsequent breakdown below the 100-day SMA favors the USD bears. Moreover, oscillators on the daily chart are holding in negative territory and are still away from being in the oversold zone. This, in turn, suggests that any further move up could be seen as a selling opportunity and remain capped.Moreover, the 100-day SMA flattens and remains beneath the declining 200-day one, preserving a bearish alignment. Price holds below both, with the shorter SMA at 98.63 acting as an immediate hurdle. The Moving Average Convergence Divergence (MACD) stays below the Signal line and under the zero mark, while the negative histogram contracts, hinting at fading downside momentum. The Relative Strength Index (RSI) stands at 35, near the lower end of neutral, with a modest uptick suggesting tentative stabilization.Downside risk persists while below trend filters, as the 200-day SMA trends lower at 99.25 and caps rebounds. The MACD remains under the Signal line and below zero, with the narrowing negative histogram reinforcing a tentative loss of bearish pressure. RSI’s recovery is shallow, and a push above the 50 midline would be needed to strengthen a rebound. A sustained break above 99.25 would shift the medium-term tone to the upside; failure to reclaim moving-average resistance would keep the bias weak.(The technical analysis of this story was written with the help of an AI tool)DXY daily chart
US Dollar FAQs What is the US Dollar? The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away. How do the decisions of the Federal Reserve impact the US Dollar? The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback. What is Quantitative Easing and how does it influence the US Dollar? In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar. What is Quantitative Tightening and how does it influence the US Dollar? Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar. Technical Analysis:

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Silver price refreshes all-time high near $66 as investors shift to safe-haven fleet.The demand for safe-haven assets increases amid rising US economic concerns.The US Unemployment Rate accelerates to 4.6% in November.Silver price (XAG/USD) posts a fresh all-time high near $66 during the Asian trading session on Wednesday. The white metal extends its bull run as weak United States (US) employment data, Retail Sales, and flash S&P Global Purchasing Managers’ Index (PMI) data raise economic concerns.The US Nonfarm Payrolls (NFP) report showed on Tuesday that the Unemployment Rate rose to 4.6% in November, the highest level seen since September 2021. In the same period, the economy created 64K fresh jobs, higher than estimates of 50K, but after firing 105K payrolls in October.Month-on-month Retail Sales remained flat in October, while it was expected to grow steadily by 0.1%. Meanwhile, preliminary S&P Global PMI landed at 53.0, sharply lower than 54.2 in November.Escalating US economic jitters have raised demand for safe-haven assets, such as Silver.The broader outlook of the Silver price has remained upbeat due to expectations that the Federal Reserve (Fed) will deliver more interest rate cuts in 2026 than one projected by officials in December’s policy meeting. According to the CME FedWatch tool, there is a 67.6% chance that the Fed will deliver at least two interest rate cuts next year.Silver technical analysis
Silver price trades almost 3% higher around $66.00 during Asian trading hours. The 20-period Exponential Moving Average (EMA) rises at $63.28, with price holding above the average and keeping the short-term tone positive. The 14-period Relative Strength Index (RSI) at 69.16 sits near the overbought threshold, signaling that momentum could cool before the next leg higher.Bias remains firm while the market stays above the rising EMA, where pullbacks would be cushioned. A break below the 20-period EMA would turn the intraday bias down, making Silver fragile towards the psychological level of $60.00. While a persistent hold above it would preserve upside, and keep the odds of further upside towards $70.00(The technical analysis of this story was written with the help of an AI tool) Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Japanese Yen bulls opt to move to the sidelines ahead of the key BoJ meeting this week.Bets for an imminent BoJ rate hike on Friday and a weaker risk tone should underpin the JPY.Dovish Fed expectations might cap the attempted USD recovery move and the USD/JPY pair.The Japanese Yen (JPY) edges lower during the Asian session on Wednesday as bulls turn cautious and opt to wait for the Bank of Japan (BoJ) policy update before placing fresh bets. Hence, the focus will remain glued to the outcome of a two-day BoJ meeting on Friday. Investors will look for cues about the central bank's policy path going into 2026, which will play a key role in determining the near-term trajectory for the JPY. Heading into the key central bank event, the growing acceptance of an imminent BoJ rate hike this week might continue to act as a tailwind for the JPY.Apart from this, the prevalent risk-off environment – as depicted by a generally weaker tone around the equity markets – should contribute to limiting losses for the safe-haven JPY. The US Dollar (USD), on the other hand, struggles to capitalize on the previous day's modest recovery from its lowest level since early October amid bets for more interest rate cuts by the US Federal Reserve (Fed). This marks a significant divergence in comparison to hawkish BoJ expectations, which should benefit the lower-yielding JPY and back the case for a further depreciation for the USD/JPY pair.Japanese Yen might continue to draw support from hawkish BoJ expectations and a softer risk toneThe Japanese Yen attracts some sellers during the Asian session on Wednesday amid some repositioning ahead of the highly-anticipated two-day Bank of Japan policy meeting, starting on Thursday. The central bank is widely expected to raise interest rates on Friday, and the bets were reaffirmed by the recent shift in rhetoric from BoJ Governor Kazuo Ueda.Ueda reiterated last week that the likelihood of the central bank's baseline economic and price outlook materializing had been gradually increasing. The BoJ is getting closer to attaining its inflation target, Ueda added. This offsets concerns about Japan's deteriorating fiscal condition, amid Prime Minister Sanae Takaichi's massive spending plan, and should underpin the JPY.The global risk sentiment remains on the defensive amid renewed worries about the health of China's economy and fears of the AI bubble burst. Moreover, the mixed US Nonfarm Payrolls report released on Tuesday fueled concerns about deteriorating labor market conditions in the world's largest economy and also tempered investors' appetite for perceived riskier assets.The US Bureau of Labor Statistics (BLS) reported that the economy added 64K jobs in November against consensus estimates for an increase of 50K. In contrast, October payrolls declined by 105K, while September job gains were revised down to 108K from the initial estimate of 119K. Adding to this, the Unemployment Rate climbed to 4.6% from 4.4% in the previous month.The data reaffirmed bets for further policy easing by the US Federal Reserve. In fact, traders are pricing in the possibility of two more interest rate cuts by the US central bank in 2026. This, in turn, keeps a lid on the overnight US Dollar recovery from a two-and-a-half-month low and suggests that the path of least resistance for the USD/JPY pair remains to the downside.Traders now look forward to speeches from influential FOMC members for more cues about the Fed's rate-cut path, though the market attention will be on the latest US consumer inflation figures on Thursday. Apart from this, the outcome of a two-day BoJ policy meeting on Friday will play a key role in determining the next leg of a directional move for the USD/JPY pair.USD/JPY seems vulnerable to retest the monthly swing low, around the 154.35-154.30 regionAgainst the backdrop of the USD/JPY pair's recent decline witnessed over the past week or so, the range-bound price action might still be categorized as a bearish consolidation phase. Moreover, oscillators on the daily chart have just started gaining negative traction, validating the near-term negative outlook for spot prices. Hence, weakness back towards retesting the monthly low, around the 154.35-154.30 region, en route to the 154.00 mark, looks like a distinct possibility. A convincing break below the latter will mark a fresh breakdown and pave the way for deeper losses.On the flip side, the overnight swing high, around the 155.20-155.25 region, nearing the 100-hour Simple Moving Average (SMA), now seems to act as an immediate hurdle. A sustained strength beyond could trigger a bout of a short-covering rally and allow the USD/JPY pair to reclaim the 156.00 mark. The momentum could extend further towards the monthly swing high, around the 157.00 neighborhood, touched last week. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}WTI price jumps to near $55.75 in Wednesday’s Asian session, up 1.25% on the day. Trump’s blockade announcement underpins the WTI price. US crude oil stockpiles fell by 9.3 million barrels last week, API said. West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $55.75 during the Asian trading hours on Wednesday. The WTI price climbs amid rising volatility around Latin American crude supply. Traders await the release of the Energy Information Administration (EIA) crude oil stockpiles report later on Wednesday.US President Donald Trump ordered a blockade of all sanctioned oil tankers entering and leaving Venezuela, Reuters reported late Tuesday. His comments came after US forces seized an oil tanker in waters near Venezuela, and Washington has ordered a huge build-up of US military forces off the Venezuelan coast in an operation said to target drug smuggling. Trump’s order to block sanctioned Venezuelan oil tankers could provide some support to the WTI price, as it raises supply disruption risks and adds a geopolitical premium. Furthermore, a larger-than-expected crude oil inventory draw might also boost the black gold. Data released by the American Petroleum Institute (API) on Tuesday showed that crude oil stockpiles in the US for the week ending December 12 fell by 9.3 million barrels compared to a decline of 4.8 million barrels in the previous week. The market consensus was for a 2.2 million barrel decrease in the report period.  On the other hand, a possible peace deal to end the war in Ukraine might cap the upside for the WTI. Ukrainian President Zelenskiy said on Monday that talks between the US and Ukraine to end the war with Russia were "very constructive." WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}USD/CAD rebounds after hitting a three-month low near 1.3730 on Tuesday.The US Dollar gains as mixed labor data failed to bolster expectations for further Federal Reserve rate cuts.The Canadian Dollar could find support as the BoC sees policy “about the right level,” curbing expectations for near-term easing.USD/CAD rebounds from a three-month low of 1.3730, recorded in the previous session, currently trading around 1.3770 during the Asian hours on Wednesday. The pair gains ground as the US Dollar (USD) finds support, as mixed labor market data did little to reinforce expectations of additional Federal Reserve rate cuts.The US November jobs report showed payroll growth of 64K, slightly above forecasts, but October figures were revised sharply lower, and the unemployment rate rose to 4.6%, the highest since 2021, underscoring a gradually cooling labor market. Retail sales were flat on the month, reinforcing signs that consumer demand is losing momentum.Fed officials are split over whether more easing of monetary policy is needed next year. The median Fed official penciled in just one reduction in 2026, but some policymakers see no further cuts. Meanwhile, traders anticipate two rate cuts next year.According to the Wall Street Journal, the US President Donald Trump is set to interview Fed Governor Christopher Waller on Wednesday for the top Fed job. A WSJ poll in October revealed that Waller was ranked as the top choice of economists, because “he has laid out some of the most intellectually consistent arguments for rate cuts this year and is seen as someone who might be able to navigate internal divisions.”The USD/CAD pair could extend its decline as the Canadian Dollar finds support from the Bank of Canada’s decision to keep rates at 2.25% and its view that policy is “about the right level,” dampening expectations for aggressive near-term easing.Meanwhile, Canadian inflation data, headline CPI steady at 2.2% and trimmed-mean inflation easing to a ten-month low of 2.8%, reinforced confidence that price pressures are converging toward the BoC’s target. Canadian Dollar FAQs What key factors drive the Canadian Dollar? The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar. How do the decisions of the Bank of Canada impact the Canadian Dollar? The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive. How does the price of Oil impact the Canadian Dollar? The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD. How does inflation data impact the value of the Canadian Dollar? While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar. How does economic data influence the value of the Canadian Dollar? Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.

.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a} .fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Australian Dollar weakens even as markets grow increasingly wary of an RBA rate hike as early as February.Commonwealth Bank of Australia and National Australia Bank expect earlier RBA tightening due to persistent inflation and capacity constraints.The USD may find support as mixed labor data failed to bolster expectations for further Federal Reserve rate cuts.The Australian Dollar (AUD) declines against the US Dollar (USD) on Wednesday, extending its losses for the fifth consecutive day. However, the downside of the AUD/USD pair could be restrained as the Aussie Dollar could find support as markets grow increasingly wary of a Reserve Bank of Australia (RBA) rate hike as early as February.Commonwealth Bank of Australia and National Australia Bank now expect the RBA to start tightening sooner than previously projected, pointing to stubborn inflation in a capacity-constrained economy. Their forecasts followed the central bank’s hawkish hold on rates at its final 2025 meeting last week. Swaps price in a 28% chance of a February hike, nearly 41% in March, with August almost fully priced.The AUD remains under pressure as Australia’s preliminary S&P Global Manufacturing PMI edged up to 52.2 in December from 51.6 previously, according to data released by S&P Global on Tuesday. Meanwhile, the Services PMI slipped to 51.0 from 52.8, and the Composite PMI fell to 51.1 from 52.6.US Dollar struggles despite diminishing Fed rate cut betsThe US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is holding ground and trading around 98.20 at the time of writing. The USD could find support as mixed labor market data did little to reinforce expectations of additional Federal Reserve rate cuts.The US November jobs report showed payroll growth of 64K, slightly above forecasts, but October figures were revised sharply lower and the unemployment rate rose to 4.6%, the highest since 2021, underscoring a gradually cooling labor market. Retail sales were flat on the month, reinforcing signs that consumer demand is losing momentum.Fed officials are split over whether more easing of monetary policy is needed next year. The median Fed official penciled in just one reduction in 2026, but some policymakers see no further cuts. Meanwhile, traders anticipate two rate cuts next year.The CME FedWatch tool suggests that Fed funds futures are pricing an implied 74.4% chance of a hold in rates at the US central bank's next meeting in January, up from nearly 70% a week ago.The National Bureau of Statistics (NBS) showed Monday that China’s Retail Sales rose 1.3% year-over-year (YoY) in November vs. 2.9% expected and 2.9% in October. Chinese Industrial Production increased 4.8% YoY in the same period, compared to the 5.0% forecast and 4.9% seen previously.China’s Fixed Asset Investment came in at -2.6% year-to-date (YTD) YoY in November, missing the expected -2.3% figure. The October reading was -1.7%.The Australian Bureau of Statistics (ABS) reported last week that the Unemployment Rate steadied at 4.3% in November. The figure came in below the market consensus of 4.4%. Furthermore, the Australian Employment Change arrived at -21.3K in November from 41.1K in October (revised from 42.2K), compared with the consensus forecast of 20K.Australian Dollar hovers around nine-day EMA near lower ascending channel boundaryThe AUD/USD pair is trading around 0.6630 on Wednesday. The technical analysis of the daily chart shows the pair trading within an ascending channel trend, reflecting a bullish bias. However, the pair is hovering around the nine-day Exponential Moving Average (EMA), indicating a neutral short-term price momentum.The AUD/USD pair could test the lower boundary of the ascending channel around 0.6620. A break below the channel could put downward pressure on the pair to navigate the region around the six-month low of 0.6414, recorded on August 21.On the upside, the AUD/USD pair may target the three-month high of 0.6685, followed by 0.6707, the highest since October 2024. Further advances would support the pair to test the upper ascending channel boundary around 0.6740.AUD/USD: Daily Chart Australian Dollar Price Today The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the weakest against the Japanese Yen. USD EUR GBP JPY CAD AUD NZD CHF USD 0.00% 0.01% -0.03% 0.03% 0.00% -0.01% -0.01% EUR -0.00% 0.01% -0.04% 0.03% 0.00% -0.01% -0.01% GBP -0.01% -0.01% -0.04% 0.02% -0.01% -0.02% -0.03% JPY 0.03% 0.04% 0.04% 0.07% 0.04% 0.02% 0.02% CAD -0.03% -0.03% -0.02% -0.07% -0.03% -0.05% -0.05% AUD -0.01% -0.00% 0.00% -0.04% 0.03% -0.01% -0.02% NZD 0.01% 0.01% 0.02% -0.02% 0.05% 0.01% -0.01% CHF 0.01% 0.01% 0.03% -0.02% 0.05% 0.02% 0.00% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote). Australian Dollar FAQs What key factors drive the Australian Dollar? One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar? The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar? China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar? Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar? The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Gold price climbs to near seven-week highs in Wednesday’s Asian session.A continued cooling in the US labor market weighs on the US Dollar and lifts Gold price.Traders will take more cues from the Fedspeak on Wednesday ahead of the key US inflation reports.Gold price (XAU/USD) extends its upside to near seven-week highs above $4,300 during the Asian trading hours on Wednesday. The precious metal gains momentum as the US labor market remains relatively resilient but shows signs of slowing. The mixed US employment report for November reinforces bets of further rate cuts by the US Federal Reserve (Fed) and weighs on the US Dollar (USD). Lower interest rates could reduce the opportunity cost of holding Gold, supporting the non-yielding precious metal.The US central bank delivered its third 25-basis-point rate cut at the December policy meeting last week. However, Fed policymakers are divided on whether additional rate cuts are needed in 2026. The median Fed official penciled in just one reduction next year, but some policymakers see no further cuts. Traders await the Fedspeak later on Wednesday. New York Fed President John Williams and Atlanta Fed President Raphael Bostic are set to speak. Any hawkish comments from policymakers could lift the Greenback and undermine the USD-denominated commodity price in the near term. Looking ahead, the US November Consumer Price Index (CPI) inflation data will be in the spotlight on Thursday. The Personal Consumption Expenditures (PCE) Price Index will be published on Friday. These reports could shape expectations for Fed rate cuts. Daily Digest Market Movers: Gold rises amid slowing trend in the US labor marketThe US Nonfarm Payrolls (NFP) rose by 64,000 in November after falling by 105,000 in October, according to the US Bureau of Labor Statistics (BLS) on Tuesday. This reading came in stronger than the market expectation for an increase of 50,000. The Unemployment Rate in the US ticked higher to 4.6% in November from 4.4% in October. The Average Hourly Earnings increased 0.1% MoM in November after jumping 0.4% in the previous month.US Retail Sales were unexpectedly flat in October, following a downwardly revised 0.1% gain in September, the US Census Bureau showed on Tuesday. This figure came in below the consensus of 0.1%. US President Donald Trump is set to interview Fed Governor Christopher Waller on Wednesday for the next Fed Chair, according to people familiar with that matter, per the Wall Street Journal.Markets anticipate two rate cuts next year. Fed funds futures are pricing an implied 75.6% chance of a hold in rates at the US central bank's next meeting in January, up from nearly 70% a week ago, according to the CME FedWatch tool.Gold’s long-term technical outlook remains bullishGold trades in positive territory on the day. According to the four-hour chart, the positive view of the precious metal remains intact, with the price being well-supported above the key 100-day Exponential Moving Average. Furthermore, the Bollinger Bands widen and the 14-day Relative Strength Index (RSI) is located above the midline, displaying the bullish momentum in the near term. Sustained trading above the upper boundary of the Bollinger Band of $4,305, XAU/USD could be gearing up for another run at the December 15 high of $4,350. Any follow-through buying above this level could even open the door to retest an all-time high of $4,381.On the flip side, a string of red candles could set the tone for a bearish run, with the first support level to watch at the December 16 low of $4,271. The next contention level is seen at the 100-day EMA of $4,220.  Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} US President Donald Trump ordered a blockade of all sanctioned oil tankers entering and leaving Venezuela, Reuters reported late Tuesday. “Venezuela is completely surrounded by the largest Armada ever assembled in the History of South America,” said Trump in a Truth Social post.Trump’s comments came after US forces seized an oil tanker in waters near Venezuela, and Washington has ordered a huge build-up of US military forces off the Venezuelan coast in an operation said to target drug smuggling.Market reactionAt the time of press, the WTI price is up 0.86% on the day at $55.55. WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}EUR/USD draws some support as the post-US NFP USD recovery runs out of steam.The divergent Fed-ECB expectations contribute to limiting the downside for the pair.Traders seem reluctant ahead of the ECB meeting and the US CPI print on Thursday.The EUR/USD pair steadies around the 1.1750 area during the Asian session on Wednesday, and for now, seems to have stalled the previous day's sharp retracement slide from the highest level since September 24. Meanwhile, the fundamental backdrop remains tilted in favor of bullish traders and suggests that the path of least resistance for spot prices remains to the upside.The US Dollar (USD) struggles to capitalize on the previous day's post-US Nonfarm Payrolls (NFP) bounce from its lowest level since early October amid dovish Federal Reserve (Fed) bets and acts as a tailwind for the EUR/USD pair. The US Bureau of Labor Statistics (BLS) reported that the economy added 64K jobs in November against consensus estimates for an increase of 50K and a fall of 105K in October. Additional details revealed that the Unemployment Rate climbed to 4.6% last month from 4.4% previous.The mixed jobs data, however, did little to dent expectations that the US central bank will lower borrowing costs two more times next year. Furthermore, expectations for a dovish replacement of Fed Chair Jerome Powell contribute to capping the USD. A Wall Street Journal article indicated that US President Donald Trump will interview Fed Governor Christopher Waller, adding his name to the list consisting of National Economic Council Director Kevin Hassett and former Fed Governor Kevin Warsh for the Fed top job.The shared currency, on the other hand, continues to draw support from the growing acceptance that the European Central Bank (ECB) is done cutting interest rates. Traders, however, seem reluctant and opt to wait for the crucial ECB meeting on Thursday. The latter will be followed by the latest US consumer inflation figures, which will play a key role in driving the USD demand and providing a fresh impetus to the EUR/USD pair. In the meantime, traders on Wednesday will take cues from the final Eurozone CPI print. Euro FAQs What is the Euro? The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} On Wednesday, the People’s Bank of China (PBOC) sets the USD/CNY central rate for the trading session ahead at 7.0573 compared to the previous day's fix of 7.0602. PBOC FAQs What does the People's Bank of China do? The primary monetary policy objectives of the People's Bank of China (PBoC) are to safeguard price stability, including exchange rate stability, and promote economic growth. China’s central bank also aims to implement financial reforms, such as opening and developing the financial market. Who owns the PBoC? The PBoC is owned by the state of the People's Republic of China (PRC), so it is not considered an autonomous institution. The Chinese Communist Party (CCP) Committee Secretary, nominated by the Chairman of the State Council, has a key influence on the PBoC’s management and direction, not the governor. However, Mr. Pan Gongsheng currently holds both of these posts. What are the main policy tools used by the PBoC? Unlike the Western economies, the PBoC uses a broader set of monetary policy instruments to achieve its objectives. The primary tools include a seven-day Reverse Repo Rate (RRR), Medium-term Lending Facility (MLF), foreign exchange interventions and Reserve Requirement Ratio (RRR). However, The Loan Prime Rate (LPR) is China’s benchmark interest rate. Changes to the LPR directly influence the rates that need to be paid in the market for loans and mortgages and the interest paid on savings. By changing the LPR, China’s central bank can also influence the exchange rates of the Chinese Renminbi. Are private banks allowed in China? Yes, China has 19 private banks – a small fraction of the financial system. The largest private banks are digital lenders WeBank and MYbank, which are backed by tech giants Tencent and Ant Group, per The Straits Times. In 2014, China allowed domestic lenders fully capitalized by private funds to operate in the state-dominated financial sector.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}NZD/USD trades with a negative bias amid China’s economic woes and the risk-off impulse.Fed rate cut bets cap the post-NFP USD recovery and support the pair amid hawkish RBNZ.Traders now look to Fed speak for some impetus ahead of the US CPI report on Thursday.The NZD/USD pair struggles to capitalize on the previous day's bounce from the 0.5760-0.5755 region, or an over one-week low, and ticks lower during the Asian session on Wednesday. Spot prices currently trade around the 0.5780-0.5775 area, down nearly 0.20% for the day, though the fundamental backdrop warrants caution for bearish traders.Disappointing Chinese macro data released on Monday revived concerns about the health of the world's second-largest economy. This, along with a generally weaker tone around the equity markets, is seen undermining the perceived riskier Kiwi and acting as a headwind for the NZD/USD pair. However, the Reserve Bank of New Zealand's (RBNZ) hawkish outlook on the future policy path should help limit deeper losses for the New Zealand Dollar (NZD).RBNZ Governor Ann Breman emphasised earlier this week that if economic conditions unfold as expected, the Official Cash Rate (OCR) is likely to remain at its current level of 2.25% for an extended period. This marks a significant divergence in comparison to bets for two more interest rate cuts by the US Federal Reserve (Fed) in 2026, which caps the US Dollar's (USD) post-US NFP bounce from the lowest level since early October and lends support to the NZD/USD pair.Furthermore, expectations for a dovish replacement of Fed Chair Jerome Powell might hold back the USD bulls from placing aggressive bets. Market participants now look forward to speeches from influential FOMC members, which, along with the US consumer inflation figures on Thursday, would shape expectations about the Fed's policy path. This will play a key role in driving the USD demand in the near-term and provide a fresh impetus to the NZD/USD pair.Nevertheless, the aforementioned supportive fundamental backdrop backs the case for the emergence of dip-buyers at lower levels. Hence, it will be prudent to wait for strong follow-through selling before positioning for an extension of the NZD/USD pair’s recent corrective pullback from the 0.5830 region, or a multi-month high, touched last Thursday. New Zealand Dollar FAQs What key factors drive the New Zealand Dollar? The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD. How do decisions of the RBNZ impact the New Zealand Dollar? The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair. How does economic data influence the value of the New Zealand Dollar? Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate. How does broader risk sentiment impact the New Zealand Dollar? The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.

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The Pound Sterling (GBP) edges higher against the Greenback on the upbeat UK preliminary S&P Global Purchasing Managers' Index (PMI) data. Traders will take more cues from the Fedspeak later on Wednesday. Data released by S&P Global on Tuesday showed that the UK Composite PMI came in at 52.1, versus estimates of 51.4 and the previous reading of 51.2. The Services and the Manufacturing PMI jumped to 52.1 and 51.2, respectively. Both figures came in above the market consensus. The improvement in the UK’s dominant services sector added to the positive tone and provided some support to the GBP against the US Dollar (USD). Nonetheless, expectations of a Bank of England (BoE) interest rate cut on Thursday might cap the upside for the Cable. Markets are widely anticipating the UK central bank to reduce its key bank rate by 25 basis points (bps) to 3.75% at its December meeting.  "We continue to think the BoE will cut faster than markets currently price, with the Bank Rate declining to 3% by the end of 2026. The PMI data does not change that view," said Jefferies economist Modupe Adegbembo.Federal Reserve (Fed) officials are split over whether more easing of monetary policy is needed next year. The median Fed official penciled in just one reduction in 2026, but some policymakers see no further cuts. Meanwhile, traders anticipate two rate cuts next year. Fed funds futures are pricing an implied 75.6% chance of a hold in rates at the US central bank's next meeting in January, up from nearly 70% a week ago, according to the CME FedWatch tool. Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

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The Japanese Yen (JPY) strengthens against the US Dollar (USD) amid growing speculation that the Bank of Japan (BoJ) will hike rates to 0.75% on Friday. The US Nonfarm Payrolls (NFP)rose by 64,000 in November after declining 105,000 in October, the US Bureau of Labor Statistics (BLS) reported on Tuesday. This reading came in stronger than the market expectation for an increase of 50,000. The report also showed that NFP declined by 105,000 in October. Meanwhile, the Unemployment Rate in the US climbed to 4.6% in November from 4.4% in October. The Greenback faced some selling pressure in the immediate reaction to the mixed US employment report. Fed policymakers are divided on whether additional rate cuts are needed in 2026. The median Fed official forecasts just one reduction next year, although traders expect two. The BoJ is anticipated to raise interest rates to 0.75% from 0.5% at a two-day policy meeting ending on Friday, a three-decade high, and pledge to keep hiking borrowing costs. Traders ramped up their bets for an imminent BoJ rate hike following Governor Kazuo Ueda's comments last week, saying that the likelihood of the central bank's baseline economic and price outlook materializing had been gradually increasing. Firming BoJ rate hike expectations could boost the JPY and act as a headwind for the pair in the near term. Federal Reserve (Fed) officials are scheduled to speak later on Wednesday, including New York Fed President John Williams and Atlanta Fed President Raphael Bostic. Any hawkish comments from Fed policymakers might help limit the Greenback’s losses.  Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.