Merlin breaks down the major events of the week and adds color commentary to our current market situation. He also takes a look at the European markets for trading opportunities as the dollar continues to rally, providing great international plays.
Editors’ Picks
EUR/USD rises to near 1.1650 amid dovish Fed expectations
EUR/USD edges higher after registering gains in the previous six successive sessions, trading around 1.1650 during the Asian hours on Monday. The pair appreciates as the US Dollar struggles amid dovish Federal Reserve expectations. Friday’s slower-than-expected US jobs growth suggests the US central bank could hold interest rates steady later this month.
GBP/USD rebounds from three-week low, eyes mid-1.3400s as Fed concerns weigh on USD
The GBP/USD pair attracts some buyers near a technically significant 200-day Simple Moving Average (SMA) and recovers slightly from a nearly three-week low, touched during the Asian session on Monday. Spot prices, for now, seem to have snapped a four-day losing streak and currently trade around the 1.3435 region, up 0.20% for the day.
USD/JPY turns south toward 157.50 amid risk aversion
USD/JPY reverses course and comes under selling pressure, heading toward 157.50 in the Asian session on Monday. Looming geopolitical risks and concerns over the Fed's independence offset renewed Japanese political tensions, underpinning the safe-haven Japanese Yen at the expense of the US Dollar.
Editors’ Picks
Gold tests $4,600, then retreats despite geopolitical, Fed woes
Gold retreats from fresh record highs of $4,601 in the Asian session on Monday. Reports that US President Donald Trump is weighing a series of potential military options in Iran fuel the risk of a further escalation of geopolitical tensions will likely keep Gold underpinned despite the latest profit-taking pullback.
AUD/USD retakes 0.6700 as USD slips on Fed's autonomy concerns
AUD/USD is re-attempting 0.6700 in Monday's Asian trading, helped by a fresh decline in the US Dollar as concerns over the Fed's independence intensify. Further, hawkish RBA expectations remain supportive of the Aussie. However, geopolitical risks-led softer risk tone could limit the pait's upside.
USD/JPY turns south toward 157.50 amid risk aversion
USD/JPY reverses course and comes under selling pressure, heading toward 157.50 in the Asian session on Monday. Looming geopolitical risks and concerns over the Fed's independence offset renewed Japanese political tensions, underpinning the safe-haven Japanese Yen at the expense of the US Dollar.
Week ahead: US CPI might challenge the geopolitics-boosted Dollar
Geopolitics may try to steal the limelight from US data. A possible US Supreme Court ruling on tariffs could dictate market movements. Dollar strength might be tested if investors refocus on Fed expectations. A crammed data calendar next week, US CPI comes on Tuesday; Fedspeak to intensify. Euro weakness persists, lingering risk of deterioration in US-EU relations.
2026 economic and market outlook
As an aggregate, key economic indicators point towards the global economy growing further in out 2026 Economic and Market outlook. In particular, the G20 countries, which account for roughly 80% of the total global GDP are projected to grow by 2.9% next year.
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