Gold (XAU/USD) edges lower after hitting yet another all-time high near $4,380 on Friday as investors seek a reliable store of value amid geopolitical, economic and fiscal uncertainty.
Downward momentum continues to increase, and there is scope for US Dollar (USD) to test 7.1130. In the longer run, USD could drop to 7.1130; a clear break below this level will shift the focus to 7.1000, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Risk for US Dollar (USD) remains on the downside; oversold conditions suggest any decline may not reach 149.50. In the longer run, the odds of USD breaking clearly below 149.50 are increasing, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
New Zealand Dollar (NZD) is likely to consolidate in a range of 0.5705/0.5750. In the longer run, the outlook for NZD is neutral now, and it is likely to trade in a range between 0.5685 and 0.5770, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
There is a chance for Pound Sterling (GBP) to test 1.3475; a continued rise above this level is unlikely. In the longer run, if GBP breaks clearly above 1.3475, it could rise further to 1.3505, potentially testing 1.3530, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
There is room for Euro (EUR) to rise further; it remains to be seen whether it can break clearly above 1.1720. In the longer run, upward momentum is building, but EUR must close above 1.1720 before a move toward 1.1760 can be expected, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
The Japanese Yen (JPY) has recovered somewhat in recent days and is currently trading around 150 to the US dollar again. However, I must say that the reason for this is not quite what I had expected.
The Swedish krona is the second-best performer this week, rising even more than the euro as equities sold off yesterday. This sounds rather odd given SEK’s usually high beta (especially relative to the euro) to risk assets, ING's FX analyst Francesco Pesole notes.
US Dollar (USD) continued to drift lower on dovish remarks from Fed officials, surprise turn lower in Philadelphia business outlook, extended US government shutdown, falling UST yields and the negative sentiments on some US regional banks over exposure to auto bankruptcy.
A sudden return of market scrutiny on US regional banks is adding a rather unexpected negative factor to the dollar. US equities took a hit yesterday, with the S&P500 regional banks sub-index plummeting 5% after two lenders reported problems with loans associated with fraud.
USD/CNY fix was set lower at 7.0949 and below 7.10 for a 3rd consecutive session. USD/CNH last seen at 7.1280 levels, largely in line with yesterday spot despite the USD/CNY fix going lower, OCBC's FX analysts Frances Cheung and Christopher Wong note.
EUR/USD rose again yesterday, but primarily on the back of US Dollar (USD) weakness, as markets had largely priced in that French PM Lecornu would survive the no-confidence motions, ING's FX analyst Francesco Pesole notes.
EUR/USD has rebounded from last week’s low and broken a short-term downtrend, but repeated failures around the 50-DMA underline lingering indecision. A sustained break above 1.1780/1.1820 is needed to confirm upside traction, Société Générale's FX analysts note.
The Euro received a boost from French PM Sébastien Lecornu’s victory in two no-confidence votes on Thursday. The pair bounced up from 0.8665 and retraced Wednesday’s losses, aiming for the top of the recent range, in the area of 0.8720-0.8730.
USD/CAD inches lower after registering gains in the previous session, trading around 1.4050 during the early European hours on Friday. The technical analysis of the daily chart suggests a persistent bullish bias as the pair is moving upwards within the ascending channel pattern.
NZD/USD gains ground after a flat performance in the previous session, trading around 0.5730 during the Asian hours on Friday. The daily chart’s technical analysis signals a potential bullish reversal as the pair price moves ahead in the descending wedge pattern.
The AUD/JPY cross extends the decline to around 97.10 during the Asian trading hours on Friday. The Japanese Yen (JPY) strengthens against the Australian Dollar (AUD) amid concerns over escalating US-China trade tensions and geopolitical uncertainties.
The GBP/USD pair gains positive traction for the third consecutive day on Friday and moves further away from its lowest level since early August, around the 1.3250-1.3245 region touched earlier this week.
Minneapolis Fed President Neel Kashkari's comments reinforce expectations of measured policy easing rather than an aggressive rate-cut cycle. His confidence in growth and subdued inflation outlook support market pricing for limited near-term cuts, while highlighting the data uncertainty caused by the shutdown.
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