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Australian employment plunged as unemployment hit multi-year highs RBA rate hike expectations slashed following disappointing jobs data AUD/USD yield spread relationships have flipped since quarter-end Improving risk appetite and bullish reversal offer recovery potential AUD/USD was hammered on Thursday, underperforming against all major currencies despite broad-based weakness in the US dollar, undermined by another very soft Australian employment report that compounded the effects of widespread risk aversion earlier in the week.

The details in the jobs report were undeniably weak, prompting markets to pare expectations for further RBA tightening. But with broader risk appetite showing signs of recovery on Thursday, and the currency looking stretched on shorter-term timeframes, there's reason to question whether the selling pressure will persist heading into the weekend.

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Australian labour market deteriorating faster than expected Australia's September employment report delivered another round of disappointing data, with employment falling by more than 39,000 and the unemployment rate rising to a fresh multi-year high of 4.72%, well above the 4.5% December quarter average forecast by the RBA only a couple of months ago.

Source: ABS, RBA

Clearly, evidence is accumulating that the labour market is deteriorating faster than the RBA was expecting, leading markets to pare expectations for further rate hikes following the move delivered in September.

The implied probability of a 25 basis point hike on November 3 now sits at just 15.6%, nearly halving relative to a session earlier, while the probability of a move by December is now under 50% at 43.6%. Looking further out, markets are no longer fully priced for another 25 basis point rate hike this cycle, contributing to the Aussie's underperformance against the G10 FX universe on Thursday.

Source: TradingView

AUD/USD relationships become confused since quarter-end While that weighed on the Aussie yesterday, what's clear so far in October is that its relationship with interest rate differentials, evident over longer periods, has become confused and broadly unreliable.

As the graphic below shows, AUD/USD maintained a reasonably strong positive correlation with short and longer-dated yield spreads between Australia and the US during the September quarter, at +0.55 and +0.45 respectively. But so far in October, both relationships have flipped on their head, sitting in mildly negative territory. There's also been no consistent relationship with outright US Treasury yields, suggesting interest rate movements may not be a particularly useful steer for directional risk in the Aussie right now.

Source: LSEG

In contrast, its relationship with cyclical assets, such as global materials equities and industrial metals, has been far more consistent, including in October. That's evident in the correlation coefficients with the MSCI World Materials Index and Bloomberg Industrial Metals Index of +0.58 and +0.56 respectively this month, broadly consistent with what we saw over the September quarter.

AUD/USD has also maintained a mildly positive relationship with US equity futures, indicating the Aussie still clings to its historical standing as a cyclical risk-on barometer.

While these relationships are not definitive by any stretch, just because the Aussie was undermined by an unwind in hawkish RBA pricing yesterday doesn't mean that weakness will necessarily continue beyond the move already seen.

Risk appetite offers the Aussie a potential lifeline Precious metals rallied sharply on Thursday, with gold and silver posting large gains after being hit hard earlier in the week, while US equities pared earlier losses to finish flat to higher, led by cyclical sectors.

With the Aussie maintaining a persistent positive relationship with cyclical assets, the recovery in broader risk appetite hints that Thursday's weakness may not last heading into the weekend.

AUD/USD: Bulls look to build on morning star reversal

Source: TradingView

AUD/USD traded and closed beneath its lower Bollinger Band on the four-hourly timeframe following the jobs report, prompting me to undertake a historical backtest of similar episodes to see how the Aussie tended to perform in the period following.

However, the results revealed no strong tendency in either direction, suggesting there may be more signal from price action than stretched conditions in the short term.

Having traded to fresh multi-month lows beneath 0.69042 during Thursday's Asian session, bids managed to push AUD/USD back above the level, with the following candle extending the rebound and closing more than halfway up the preceding bearish candle, completing a bullish morning star reversal pattern in the process.

The key now is whether we see follow-through buying into early Asian trade. If the price holds up heading towards the opening of Asian equity markets, longs could be considered with a tight stop beneath entry for protection, targeting initially 0.69328, the October 8 low. Above that, 0.6950 and 0.6980 are other levels that screen as potential targets, with a tougher resistance zone looming above 0.7000.

On the downside, a reversal back towards 0.69042 would question the merits of long setups, putting greater emphasis on price action around that level when assessing directional risk. A move beneath 0.69042 that sticks on a closing basis would shift directional risk back to the downside in the near term, especially with RSI (14) and MACD continuing to favour short setups over longs.

Well, yesterday's market winners aren't looking quite so comfortable today.

After an impressive advance through major technical resistance, the U.S. dollar has turned lower and is now testing an important support area.

Meanwhile, gold buyers have staged a recovery after yesterday's bearish breakdown, attempting to reclaim levels that sellers had managed to break.

A turnaround in both markets?

Possibly. But there's a catch.

Neither side has done enough to declare a decisive victory.

The dollar still has important support levels to defend, while gold buyers are facing resistance barriers that have repeatedly stopped their advances.

So, is today's price action the beginning of a bigger change or simply another round of testing the market's technical boundaries?

Let's look at the evidence.

U.S. Dollar (DX.F) - Yesterday's breakthrough, today's reality check

Well, the dollar bulls certainly gave us something to talk about yesterday.

Their impressive rally pushed the greenback above several important technical barriers, including the upper boundary of the wedge and the combination of the 38.2% and 50% Fibonacci retracements visible on the weekly chart.

That was a meaningful achievement.

But here's the problem.

Buyers couldn't hold their ground.

Despite yesterday's strong advance, the dollar didn't reach the potential resistance area at 102.87-102.96 that we highlighted in our previous Lab. Instead, sellers stepped in earlier and today's price action has brought another setback for the bulls.

The bears strike backThe dollar has retreated below the important resistance barriers it briefly overcame yesterday. On the weekly chart, that means the attempted bullish breakout has failed to hold so far, but because the week isn't over, we're not treating this as a confirmed weekly invalidation just yet.

There's another important detail.

Despite yesterday's impressive rally, buyers failed to confirm the closure of Tuesday's bearish gap at 102.33-102.37 on a daily closing basis. And now, the daily indicators have generated sell signals, adding another technical argument to the ongoing correction.

So, have the bears finally regained control?

Not so fast.

Buyers still have two important support areasToday's decline has already brought the dollar into the bullish gap at 101.60-101.70, created on October 7 and just below it lies another crucial support zone: the June and July highs at 101.49–101.57.

Remember these levels?

We've repeatedly emphasized their importance to the broader technical outlook, and they remain just as relevant today. In our opinion, as long as buyers manage to defend these support areas, another attempt to challenge the recently broken resistance barriers remains a possibility.

A successful recovery could bring the 102.36-102.49 resistance zone back into focus and only if buyers manage to reclaim that area would another advance toward the previously discussed 102.87-102.96 region become more compelling.

What would strengthen the bearish case?A confirmed daily closure of the bullish gap, followed by a break below the 101.49-101.57 support zone, would be a considerably more serious warning. Such a development would undermine the technical foundation supporting another bullish attempt and strengthen the case for further weakness.

For now, however, sellers haven't achieved that.

Daily Takeaway

•             Bearish development: the dollar has retreated below the weekly resistance barriers it briefly overcame, while daily indicators have generated sell signals.

•             First important support: the October 7 bullish gap at 101.60-101.70.

•             Critical structural support: the June and July highs at 101.49-101.57.

•             Bullish alternative: a successful defense of these support areas could allow another attempt to overcome 102.36-102.49.

Bottom line: yesterday, buyers demonstrated that they could push through resistance. Today, sellers have shown that they can force them back, but the bigger question is whether the bulls can defend support and prepare another attempt. Breaking through resistance is one thing. Staying above it is another. And defending support after a failed breakout may be the next important test.

Gold (GC.F) - The bulls are back; But they've got something to prove.

Well, gold buyers have decided they aren't ready to surrender just yet and after yesterday's session, that's quite an interesting development.

Remember what happened?

Gold closed below the previously broken upper boundary of the red falling wedge, confirming the invalidation of the earlier bullish breakout. Sellers also pushed the price below the lower boundary of the orange consolidation at 4156. That brought our bearish scenario into focus, including the potential minimum downside objective around 4080, based on the height of the consolidation at 4156-4233.

But the bears didn't get that far.

And here's where the story gets interesting.

The weekly gap attracts buyersYesterday, gold briefly moved below the lower boundary of the important weekly bullish gap at 4098-4135. However, the decline stopped at 4095, before reaching the previous low at 4091.

And buyers responded.

Under our weekly closing-confirmation approach, this brief move below the gap hasn't confirmed its closure on the weekly chart. The support area remains an important part of the technical picture but there's another detail worth highlighting.

A new bullish gap inside the weekly support areaToday's Asian session began with a bullish gap at 4107-4125 and notice where that gap is located… right inside the broader weekly bullish gap at 4098-4135.

That's a particularly interesting combination.

It shows that buyers have started pushing back in precisely the area we identified yesterday as crucial for the weekly outlook and they didn't stop there.

Today's recovery has carried gold back above the previously broken upper boundary of the red falling wedge. Buyers have also pushed the price back above 4156, attempting to invalidate yesterday's breakdown below the orange consolidation.

That's encouraging, but we still need to distinguish between an intraday recovery and a confirmed daily reversal of the breakdown.

A daily close back above 4156 would strengthen the case that yesterday's move below the consolidation has failed.

The Real Test Is Still Ahead

Now comes the part where we need to be careful.

Just because buyers have recovered lost ground doesn't mean they're ready to launch another powerful rally.

Why?

Take a look at the 4240-4250 resistance area.

Gold bulls have already challenged this region three times and every time, sellers have pushed them back, leaving extended upper shadows on the daily candles. That's a warning we shouldn't ignore. The upper boundary of the orange consolidation at 4233 adds another obstacle immediately below this resistance zone.

So, even if buyers successfully invalidate yesterday's bearish breakdown, their next challenge will be considerably more demanding.

A sustained move above 4240-4250 would provide a much stronger argument that buyers are ready to regain control.

Until then, another rejection remains possible and if gold slips back below 4156, the bearish scenario we've been tracking could quickly return to the spotlight.

Daily Takeaway

•             Bullish development: buyers have defended the area of the weekly gap at 4098-4135 and returned above the previously broken falling wedge.

•             Additional positive signal: today's bullish gap at 4107-4125 lies inside the weekly support area.

•             Key short-term confirmation: a daily close above 4156 would strengthen the invalidation of yesterday's breakdown from the orange consolidation.

•             Major resistance: 4233, followed by the repeatedly defended 4240-4250 area.

•             Bearish alternative: renewed weakness below 4156 would bring the earlier downside scenario back into focus.

Bottom line: the bulls have delivered an encouraging recovery, but the repeated failures around 4240-4250 remain an important warning. The bulls have shown they can defend support. Now they need to prove they can overcome resistance.

And what about the rest of the metals market?Gold isn't the only metal attempting a recovery today.

Silver has bounced but remains below important broken trendlines. Platinum and palladium are trying to invalidate yesterday's bearish breakdowns, while copper sellers have received another technical advantage from a fresh bearish gap.

And here's what makes the broader picture particularly interesting: not every rebound carries the same weight, and not every bearish signal has received confirmation.

Final thought - The first move isn't the whole storyYesterday, the dollar bulls looked strong and gold sellers appeared to have the advantage.

Today, both markets are challenging those impressions.

But there's an important difference between a market attempting to reverse direction and actually confirming that reversal. The dollar still needs to defend its support. Gold still needs to overcome resistance.

Until those battles are resolved, both bullish and bearish possibilities deserve our attention. The first move gets our attention. What happens next earns our conviction.

Several large Indian mutual funds issued public notices late on Thursday suspending bulk subscriptions to gold exchange-traded funds, just ahead ​of the festive season when investor demand typically rises.

The notices from the ‌fund houses, including Kotak Mahindra Mutual Fund, UTI Mutual Fund and HDFC Mutual Fund, did not cite a reason for the move. There is no restriction on redemptions from these funds.

The decision ​was taken following a nudge from the Securities and Exchange Board of India, ​according to a mutual fund executive familiar with the discussions. Two ⁠bullion industry officials confirmed the halt had followed discussions with the market regulator.

The sources ​declined to be identified as they are not permitted to comment on discussions with ​the regulator.

A spokesperson for SEBI did not respond to a Reuters request for comment outside business hours.

The Indian rupee has been under pressure this year due to a surge in global oil prices, which ​have inflated the country's import bill, and heavy selling by foreign investors in Indian ​equities. Strong demand for gold has further weighed on the currency, prompting the government to raise ‌import ⁠duties on gold and silver earlier this year.

India, the world's largest consumer of silver and second-largest consumer of gold, relies on imports to meet most of its demand, a dependence that can sometimes widen its trade deficit.

Gold imports fell to $1.8 billion in September, ​from $2.3 billion in August. ​However, Indians will ⁠celebrate Dussehra in October and Diwali in early November, when buying gold is considered auspicious.

Inflows into gold and silver ETFs surged ​during last year's festive season as investors turned to precious metals ​amid lackluster ⁠stock market returns.

The move is surprising, as gold and silver imports have fallen sharply over the past two months from a year earlier and have not contributed to the ⁠trade deficit, ​said a dealer at a private bank that ​supplies bullion to ETFs.

"It looks more like a precautionary measure to avoid a surge in imports in October," ​the dealer said.

Gold Technical Outlook: XAU/USD Short-term Trade Levels
Gold has declined nearly 10% from the September high, but selling pressure has stalled near major technical support.
XAU/USD has held above a pivotal support zone for two weeks, with daily momentum divergence warning of possible downside exhaustion.
The October opening range remains intact, putting the focus on a decisive break for near-term directional guidance.
A sustained push above range resistance would strengthen the case for a more meaningful recovery.
Failure to preserve support would threaten another wave of accelerated selling and bring the yearly lows back into focus.
Resistance 4230, 4307/19 (key), 4382- Support 4096-4104 (key), 4007, 3951
Gold remains at an important technical crossroads as October trade unfolds, with buyers attempting to establish a foothold following the sharp decline from the September highs. Although the broader near-term trend remains bearish, increasingly divergent momentum suggests selling pressure may be losing traction, leaving the market vulnerable to a larger reaction in the days ahead. The immediate challenge is whether bulls can force a recovery through overhead resistance or whether another wave of selling triggers a deeper correction. Meanwhile, this week's hotter-than-expected inflation data and subsequent Fed commentary have fueled sharp swings in Treasury yields and interest-rate expectations, adding another layer of uncertainty ahead of the October FOMC decision. Battle lines drawn on the XAU/USD short-term technical charts.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this gold technical setup and more. Join live on Monday’s at 8:30am EST and follow this setup throughout the week in the Opening Bell.

Gold Price Chart – XAU/USD Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView

Technical Outlook: In last month’s Gold Short-term Outlook we noted that XAU/USD was, “trading just above pivotal support with the monthly opening range preserved ahead of major event risk. From a trading standpoint, losses would need to be limited to 4230 for the July uptrend to remain viable..” A definitive late-month break lower invalidated the July uptrend with the decline extending more than 9.8% off the September high.

The losses were halted at confluent support near the 100% extension of the August selloff and the 78.6% retracement of the late-June rally at 4096-4104. Gold has been unable to mark a daily close below this level and the focus remains on possible inflection off this threshold with the October opening range intact just above. Ongoing momentum divergence on the daily chart suggests that the bears remain vulnerable while above this zone with price still holding within the confines of the September channel.

Gold Price Chart – XAU/USD 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView

Notes: A closer look at gold price action shows XAU/USD trading within a well-defined range straddling the October open at 4158 for the past two weeks. Initial resistance is eyed at the upper parallel with a breach / close above the 61.8% retracement of the June advance at 4230 needed to suggest a more significant near-term low is in place, and a larger recovery is underway. Key resistance is eyed at the 38.2% retracement of the August decline and the objective yearly open at 4307/19. A rally surpassing this threshold exposes the next major technical considerations at the October 2025 swing high at 4382 and the 61.8% retracement near 4456.

A break / daily close below confluent support would threaten another bout of accelerated losses for the yellow metal. Subsequent support objective rest at the 2026 low-day close (LDC) at 4007 and the yearly low / 2025 late-October LDC at 3942/51- look for a larger reaction there IF reached.

   
       

Bottom line: Gold has defended a key support zone the past two weeks with the monthly range set just above- look for the breakout to offer guidance here in the days ahead. From a trading standpoint, losses need to be limited to 4096 IF gold is going to make a larger recovery here with a breach / close above 4230 needed to fuel a larger breakout. Keep in mind that a decisive break below this key pivot zone could trigger a sharp deterioration in the technical outlook, opening the door for a much steeper decline.

Event risk remains elevated for gold into the weekly close, with Fed Chair Kevin Warsh’s latest commentary in focus following this week’s hotter-than-expected CPI report and subsequent reversal in Treasury yields. Although expectations for an October rate hike briefly climbed to nearly 50% following the inflation release, markets have since reversed course, now pricing a 72% probability the Fed will hold rates steady this month. With the economic calendar relatively light next week and Fed officials entering their pre-meeting blackout period, Treasury yields and the U.S. dollar are likely to remain key drivers for bullion ahead of the October FOMC decision. Stay nimble into the weekly close and watch for signs of a more decisive technical move in the days ahead. Review my latest Gold Weekly Technical Forecast for a closer look at the longer-term XAU/USD trade levels.

Key US Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Short-term Technical Charts
Canadian Dollar Short-term Outlook: USD/CAD Five-Week Rally Hits a Wall at Major Resistance
Japanese Yen Short-term Outlook: USD/JPY Breakout Risk Builds Below 200-Day Average
Australian Dollar Short-term Outlook: AUD/USD Rebound Challenges September Downtrend
US Dollar Short-term Outlook: USD Four-Week Rally Stalls Below Key Resistance
Swiss Franc Short-term Outlook: USD/CHF Rebound Tests Broken Uptrend
Euro Short-term Outlook: EUR/USD Selloff Nears Critical Yearly Support
British Pound Short-term Outlook: GBP/USD Selloff Breaks June Uptrend
--- Written by Michael Boutros, Senior Technical Strategist

Follow Michael on X @MBForex

Peru and Mexico both mined less silver than a year earlier, and Mexico was the one expected to grow, so the supply case that silver holders rely on just got a little firmer.

Metals Focus and the Silver Institute forecast world mine supply to slip slightly this year. They expect gains in Mexico and Morocco to be more than offset by declines, mainly in Peru and Argentina. Peru is falling as forecast. Mexico's latest monthly figure, for July, went the other way. Then on October 8 a strike was formally declared at San Dimas, one of Mexico's larger silver mines, where work had already stopped. One month does not overturn a full-year forecast, and the ounces involved are small next to this year's expected shortfall. But the direction favours silver holders over the coming year, even while interest rates drive the price in the short run.

The price has not reflected any of this yet. Silver fell about 6% on October 14. US consumer prices had risen faster than expected, and markets moved toward another Federal Reserve rate rise. Kitco's late-afternoon reading put silver at $55.41 and gold at $4,098.80. That is a gold-silver ratio of about 74. At that reading silver was about 22.7% below its 2025 closing price, on MetalCharts' figures. Silver pays no interest, so it becomes less attractive to hold when bonds pay more after inflation. Real yields, the return on bonds after inflation, and the dollar have been the main near-term influences on the price this year, though the daily link is not one-to-one. At Golden Meadow® I track both sides: the price, which answers to rates in the short run, and the balance of supply and demand, which builds the longer-term case.

A strike at one of Mexico's larger Silver minesWorkers at First Majestic's San Dimas mine in Durango stopped work on September 18. On October 8 about 800 of them, in two sections of Mexico's national miners' union, made it a formal strike. Extraction of gold and silver is halted. The union cites safety conditions, worn equipment, breaches of the labour contract and a productivity bonus. As of October 13, local reports said work remained completely halted, with no agreement and no date set for a return.

The dispute was already showing in the company's numbers. San Dimas produced 41% less silver in the third quarter than a year earlier, according to First Majestic's own release. The company blames 12 operating days lost to the dispute. It also cites lower grades, meaning less silver in each tonne of ore, which it links to the dispute as well. At last year's pace of output, each further month of strike removes roughly half a million ounces.

That quarterly fall needs reading with care. It mixes the strike with lower grades. Ore that is not mined during a strike can be mined later, so the quarter overstates any permanent loss of supply.

Peru and Mexico both mined lessIn August, I looked at what cut silver output in Mexico, Peru and Chile at once. The latest official figures point the same way, and they measure silver directly rather than estimate it.

Peru's mines ministry reported less silver for January to July than in the same months of 2025. The fall was 1.64 million ounces, or 2.4%. Silver output in July on its own rose 0.5%, so the decline came earlier in the year. Much of Peru's silver comes out of zinc and lead ore, and Peru's zinc output fell 22.2% in July. That fits the survey, which expected Peru's decline to come from lower output at its lead and zinc mines.

In Mexico, the statistics agency INEGI put July's mined silver 4.3% below a year earlier. That is a loss of about 0.58 million ounces in one month. Mexico also publishes a series for refined silver, which fell 2.3%. The mined series is the one that measures what came out of the ground.

Chile adds a copper signal, which is not the same as a silver signal. Copper mines are the second-largest source of byproduct silver, the silver recovered as a side product of mining another metal. Chile's copper output fell 12.7% in August, and workers at the Centinela copper mine went on strike on October 7. No Chilean source publishes the silver in that copper, so it is a pointer rather than a measurement.

Sources: Peru mines ministry via REDIMIN | INEGI, mining bulletin, September 2026 | First Majestic Q3 2026 (SEC) | REDIMIN, Peru zinc output | La Jornada, San Dimas strike | Meganoticias, strike status October 13 | El Siglo de Durango, strike declared | Endeavour Silver Q3 2026 (SEC) | PSU Connect, Hindustan Zinc | Cochilco data via CNN Chile | World Silver Survey 2026, Metals Focus and the Silver Institute

The San Dimas fall mixes the strike with lower grades, and ore not mined during a strike can be mined later, so the quarterly figure overstates a permanent supply loss. The Hindustan Zinc figure is saleable refined silver from an integrated miner and smelter, taken from a secondary report; the exchange filing was not seen.

What pulls the other waySupply is rising in some places, and an honest reading has to count them. India's Hindustan Zinc reported 20% more refined silver in the July to September quarter, about 0.93 million ounces. That is saleable metal from a company that both mines and smelts, taken from a secondary report. It measures something different from Mexico's mined output, so it cannot be subtracted from Mexico's decline. It does show supply growing elsewhere.

In Mexico itself, Endeavour Silver's total silver output across its mines rose 19% as its new Terronera mine ramped up. Discovery Silver's Cordero project in Chihuahua received its federal environmental permits on October 6. The bank BMO's model puts first production in the second half of 2029, so it adds no supply for years.

What this means to Silver investorsSilver that is used has to come from somewhere: a mine, recycling or a stockpile. When mines and recyclers supply less than the world uses, stockpiles fill the gap. Metals Focus and the Silver Institute forecast that gap at 46.3 million ounces this year, which would make 2026 the sixth year in a row of shortfall. Other things being equal, less silver mined in Peru, Mexico or at San Dimas widens it.

The size is modest. The measured declines in Peru and Mexico add up to about 2.2 million ounces. They cover different periods, so this is not a global estimate. A strike that lasts through November would add about another million ounces. None of it is large next to the forecast shortfall.

The direction matters more than the size. The survey expected Mexico to grow this year and soften Peru's decline. July went the other way, and one of the country's larger silver mines is now shut. A single month does not overturn a full-year forecast. Mexico's August figures, due around October 21, will show whether July was a blip or the start of a run. Third-quarter results from the larger producers follow from late October.

So this is good news for silver holders on the supply side, at a small scale, and it matters over the coming year rather than the coming week. The price fell on interest rates this week and may keep answering to them for a while. The supply side is what builds the longer-term case, and in the latest data it got firmer.

The Pound Sterling registers solid gains against the US Dollar, even though the latest US inflation data, instead of fueling speculation for a Fed hike in October, is nearly cementing the case for December. The GBP/USD trades at 1.3267, up 0.56%, after reaching a low of 1.3184. Read More...

Pound Sterling Price News and Forecast: GBP pares losses and nears range top at 1.3300The British Pound (GBP) retraces Wednesday’s losses against the US Dollar (USD) on Thursday, as upbeat UK macroeconomic data has offset the negative impact of Bank of England’s (BoE) Chief Economist Huw Pill's comments. The GBP/USD has returned to the mid-range of the 1.3200s, after testing year-to-date lows around 1.3140 the previous day, and approaches the last three weeks’ range top, at the 1.3300 area. Read More...

GBP/USD Price Forecast: Pound pares losses and nears range top at 1.3300The British Pound (GBP) retraces Wednesday’s losses against the US Dollar (USD) on Thursday, as upbeat UK macroeconomic data has offset the negative impact of Bank of England’s (BoE) Chief Economist Huw Pill's comments. The GBP/USD has returned to the mid-range of the 1.3200s, after testing year-to-date lows around 1.3140 the previous day, and approaches the last three weeks’ range top, at the 1.3300 area. Read More...

U.S. Dollar Pulls Back Amid Falling Treasury Yields

DXY 151026 4h Chart U.S. Dollar Index is losing ground despite strong Retail Sales data and higher-than-expected PPI report.

Retail Sales increased by +0.8% month-over-month in September, compared to analyst forecast of +0.3%.

PPI increased by +1.3% month-over-month in September, while analysts expected that it would grow by +0.5%.

Traders also had a chance to take a look at the Initial Jobless Claims report. The report showed that 199,000 Americans filed for unemployment benefits in a week, mostly in line with the analyst forecast of 200,000.

The strong pullback in Treasury yields served as a negative catalyst for the American currency. Treasury yields moved lower as traders rushed to buy bonds amid sell-off in AI stocks.

In case U.S. Dollar Index settles below the 101.90 level, it will head towards the nearest support, which is located in the 101.50 – 101.65 range. On the upside, a successful test of the resistance at 102.35 – 102.50 will open the way to the test of the next resistance level at 103.15 – 103.30.

EUR/USD Rebounds From Yearly Lows

EUR/USD 151026 4h Chart EUR/USD moved higher as traders focused on developments in bond markets and ignored the weak Euro Area Industrial Production report. The report indicated that Euro Area Industrial Production decreased by -0.5% month-over-month in August, compared to analyst forecast of +0%.

If EUR/USD stays above the 50 MA at 1.1200, it will head towards the resistance level at 1.1250 – 1.1265. On the support side, a move below the 1.1175 level will push EUR/USD towards the support at 1.1075 – 1.1090.

EUR/USD Price Forecast

Every new EUR/USD analysis as it publishes, today's technical signal and key levels, live price — on one page.

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GBP/USD Moves Higher As UK GDP Exceeds Estimates

GBP/USD 151026 4h Chart GBP/USD gained ground as traders focused on the better-than-expected UK GDP report. The report showed that UK GDP increased by +0.1% month-over-month in August, compared to analyst forecast of -0.1%.

The nearest resistance level for GBP/USD is located in the 1.3285 – 1.3300 range. In case GBP/USD climbs above the 1.3300 level, it will head towards the next resistance, which is located in the 1.3385 – 1.3400 range.

USD/CAD 151026 4h Chart USD/CAD pulled back as traders focused on the strong rebound in precious metals markets. Gold gained 1%, while silver was up by +2.4%.

Currently, USD/CAD is trying to settle below the 1.4200 level. In case this attempt is successful, USD/CAD will head towards the support level at 1.4135 – 1.4150. On the upside, a successful test of the resistance level at 1.4235 – 1.4250 will push USD/CAD towards the 1.4300 level. If USD/CAD climbs above 1.4300, it will head towards the next resistance at 1.4350 – 1.4365.

USD/JPY Remains Stuck Near Resistance At 158.00 – 158.50

USD/JPY 151026 4h Chart USD/JPY is mostly flat despite the strong pullback in Treasury yields. The yield of 2-year Treasuries declined towards the 4.75% level, while the yield of 10-year Treasuries settled below 5.10%.

The technical picture remains unchanged as USD/JPY is stuck near the resistance level at 158.00 – 158.50. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge. A move above the 158.50 level will open the way to the test of the resistance level at 160.00 – 160.50.

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Silver Price Forecast: XAG/USD rebounds, but bearish technical outlook persists

Euro to Dollar Forecast: US Yields Hold Key to Analyst's Recovery View The Euro could recover against the US Dollar if Treasury yields retreat, UniCredit says, but French fiscal concerns are likely to constrain the rebound. A retreat in US Treasury yields could give the Euro breathing room after its recent sell-off, according to UniCredit, although the bank doubts that lower American borrowing costs alone would restore EUR/USD to 1.14.

EUR/USD traded near 1.1212 on Thursday afternoon, about 0.15% above Wednesday's close.

Latest-Exchange Rates:

Euro to Dollar (EUR/USD): 1.121453 (+0.17%)

Pound to Dollar (GBP/USD): 1.326362 (+0.24%)

Dollar to Yen (USD/JPY): 157.99011 (+0.02%)

The recovery follows a sharp reversal in bond markets after US consumer inflation initially sent Treasury yields higher, before an equity sell-off encouraged investors to buy government debt.

UniCredit's FX strategist Roberto Mialich sees scope for that yield relief to support the currency, but France's public-finance difficulties have weakened the case for a fuller recovery.

His assessment offers a counterpoint to MUFG's conditional warning about a break below 1.10, which linked further Dollar strength to higher US short-term yields.

US yields have set the direction UniCredit argues that the rise in American yields has mattered more for the Euro's recent direction than changes in the gap between US and German borrowing costs.

Mialich writes: "Hence, we can argue that the rise in the 10Y UST yield has determined the direction and the decline of EUR-USD, while the yield spread between the 10Y Bund and the UST has influenced the speed of the decline."

Mialich adds: "Despite the sharp rise in the 10 UST yield, EUR-USD has only lost around 5%, as the corresponding rise in the 10Y Bund yield has prevented a more intense fall of the common currency"

Higher German returns have helped offset the appeal of US bonds.

Mialich writes: "In addition to the clear relationship visible in the chart, the results of our calculation are quite comforting: correlation is over -0.60, suggesting that a rise in the 10Y UST yield tends to be sufficiently EUR-USD negative and vice versa."

Mialich cautions that German-US yield spreads could exert a stronger influence again.

His recovery case depends on a meaningful retreat in US yields: "Still, if the soaring 10Y UST yield retreats from its current levels after reaching a twenty-year high of 5.3645% on 7 October and moves towards 5.00%/4.80% (the values prevailing in early September, before the bond market selloff), the EUR-USD decline may take a breather."

Fresh US inflation tests that recovery case Thursday's producer-price release makes it harder to assume that inflation will permit a sustained fall in yields.

US producer prices rose 1.3% in September, while the measure excluding food, energy and trade services increased 0.5%.

Those results arrived after UniCredit's assessment, which incorporated Wednesday's consumer-price surprise but not the subsequent producer figures.

Mialich explains the bank's policy assumption: "Note that such a correction in the 10Y UST yield would be in line with our baseline scenario, which includes just one more rate hike by the Fed this year and steady rates in 2027, the same picture New York Fed President John Williams depicted overnight."

If investors instead conclude that inflation requires a longer tightening cycle, the expected relief for EUR/USD could prove short-lived.

Buying Treasuries during a stock-market decline can lower yields temporarily without resolving that policy risk.

Even if US yields do fall, UniCredit does not expect the Euro simply to recover its early-September trading range.

Mialich writes: "However, lingering political tensions across the eurozone and concerns regarding public finances in France may thwart a potential EUR-USD recovery. In early September, the pair traded between 1.15 and 1.16. Re-approaching or even exceeding 1.14 has probably become a difficult task at this point."

UniCredit attaches no deadline to that recovery hurdle.

EUR/USD exchange rate FAQ Is 1.14 UniCredit's forecast target?

No. It is a level the bank considers difficult to regain, without assigning a deadline.

What could support a Euro recovery?

UniCredit expects lower US Treasury yields to relieve some of the pressure on EUR/USD.

Why might the rebound remain limited?

French fiscal concerns could weigh on the Euro even if US yields fall, while fresh US inflation threatens that yield-retreat assumption.

Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.

At first glance, the inflation report delivered almost everything Gold bears wanted. Consumer prices accelerated, underlying inflation proved more persistent than expected, and traders rapidly reassessed the likelihood of additional monetary tightening.

Yet the most revealing development may not be the initial decline. It is how quickly buyers returned. Despite renewed pressure from systematic trading strategies and a more hawkish outlook for US monetary policy, Gold continues to attract demand around a price region that has repeatedly contained declines since the summer.

That resilience raises an important question: is the latest sell-off the beginning of a deeper breakdown, or another episode in which speculative investors are selling into demand from buyers with longer investment horizons?

Hot inflation gave Gold bears exactly what they neededThe September Consumer Price Index (CPI) showed that headline inflation accelerated to 3.7% YoY, compared with 3.4% in August and market expectations of 3.6%. Core inflation, which excludes volatile food and energy prices, also accelerated to 2.6% from 2.4%, exceeding the 2.5% consensus.

Economic Calendar. Source: FXStreet.The figures reinforced concerns that inflationary pressures are spreading beyond energy and that the Fed may need to maintain restrictive monetary policy for longer than previously anticipated. Markets reacted accordingly. The probability of an October interest rate hike increased sharply immediately after the report, while expectations for another increase in December strengthened.

The initial reaction was particularly unfavorable for Gold. Higher interest rates increase the opportunity cost of holding a non-yielding asset, while rising Treasury yields and a stronger US Dollar generally reduce its attractiveness.

The combination initially brought prices to the support area that had already attracted buyers during previous corrections. However, the selling pressure was not exclusively driven by investors reassessing inflation expectations. Another group of market participants appears to have played an important role.

The real selling pressure is coming from systematic tradersAccording to TD Securities, the stronger inflation report triggered significant selling from Commodity Trading Advisors (CTAs), investment strategies that frequently rely on price trends and systematic trading signals. The bank explains that "CTAs have turned heavy sellers of gold amid a higher than expected inflation print and as prices have found heavy resistance near the $4,200/oz level."

The latest episode follows several weeks of speculative repositioning. In its earlier analysis of Gold futures positioning, TD Securities reported that speculative investors had reduced long exposure while increasing short positions for three consecutive weeks. The bank also identified approximately $4,300 as an important threshold for triggering short covering from systematic strategies.

The latest inflation surprise therefore arrived in a market where speculative investors were already positioned defensively. But selling pressure from CTAs does not necessarily mean that all investors are abandoning Gold. Indeed, the bank identified another category of flows moving in the opposite direction.

The buyers aren't disappearing. They're waiting lowerOne of the most important observations in TD Securities' latest research concerns the demand that continues to absorb speculative selling. While systematic traders have increased their bearish exposure, the bank noted that offsetting flows "have ultimately offered strong support for gold," adding that "we expect these flows will remain robust, especially in the $4,000-4,100/oz region."

This assessment supports the idea that the latest decline may represent a confrontation between different groups of investors rather than a broad liquidation of Gold holdings. Short-term traders are reacting to higher inflation, changing interest rate expectations and deteriorating price momentum. Meanwhile, other investors appear willing to accumulate Gold at lower valuations.

The distinction is consistent with the positioning divergence highlighted before the CPI release, when TD Securities identified continued buying interest from discretionary investors and Exchange-Traded Funds (ETFs), despite bearish positioning among systematic strategies.

Gold ETF flows. Source: World Gold CouncilThis creates a potentially important market dynamic. As speculative traders liquidate long positions or establish new shorts, they generate immediate selling pressure. But if other investors absorb that supply, the market can stabilize without requiring a significant improvement in the macroeconomic environment.

Moreover, the reduction of speculative long exposure can eventually diminish the pool of investors vulnerable to forced liquidation. That does not automatically establish a market bottom. However, it means that the relationship between negative news and falling prices can weaken as positioning becomes increasingly defensive.

The latest rebound suggests that this mechanism may already be operating around $4,100.

The bond market just challenged the bearish Gold narrativePerhaps the most surprising development following the inflation report occurred in the US Treasury market. Bond yields initially increased as traders priced in a greater probability of additional Fed tightening. However, the move subsequently reversed, with the benchmark 10-year Treasury yield falling to a three-week low on Thursday.

US 10-year bond yield. Source: CNBCOne possible catalyst behind this reversal emerged from China. According to a Bloomberg report, China has been quietly accumulating US Treasury securities through custodians outside the United States.

The revelation provided a possible explanation for renewed demand for US government debt. When investors purchase Treasuries, bond prices rise and yields decline. This mechanism can provide relief to Gold by reducing the opportunity cost of holding a non-yielding asset. The US Dollar (USD) also retreated from its highest level in approximately 18 months, reinforcing the precious metal's recovery.

Saxo Bank Head of Commodity Strategy Ole Hansen highlighted the importance of this development in comments reported by Reuters: "Falling real yields and resilient investment demand help gold recover from its post-CPI selloff, but the technical outlook remains fragile."

For Gold, the key question is whether bond demand can contribute to a sustained decline in Treasury yields, even as inflation remains elevated and the Fed maintains a tightening bias. If yields continue retreating while investment demand remains resilient, Gold could find additional support despite the unfavorable inflation backdrop.

The latest rebound therefore highlights an important contradiction: the inflation report gave Gold sellers a reason to push prices lower, but the bond market's response may have removed part of the pressure needed to sustain that decline.

$4,100 is becoming a floor candidate, but $3,940 remains the real test

Gold (XAU/USD) daily chart. Source: FXStreet.The daily chart reinforces the importance of the broader support region identified during previous corrections. Gold trades below its 50-day, 100-day and 200-day Simple Moving Averages (SMAs), currently near $4,335, $4,246 and $4,524, respectively. This configuration indicates that the broader trend remains under pressure despite Thursday's recovery.

However, the $4,100 region continues to attract buyers, following several successful defenses of the area since late September. Wednesday's decline toward $4,073 briefly pushed prices below this level without producing a sustained breakdown.

The importance of this support extends beyond the immediate $4,100 level. Gold repeatedly found demand around $4,000 during the summer, with the broader $4,100-$3,940 region representing a critical area for assessing whether longer-term buyers remain willing to absorb speculative selling.

A decisive break below $3,940 would weaken the argument that the recent consolidation represents a durable accumulation phase. It could also open the door to a deeper correction. Conversely, maintaining this broader support region would suggest that the market continues to absorb selling pressure despite an unfavorable interest rate environment.

On the upside, the $4,200-$4,225 area remains the first significant obstacle, having repeatedly limited recovery attempts in recent weeks. A sustained break above this region would expose the 100-day SMA near $4,246, followed by the $4,300-$4,335 area, where the 50-day SMA and an important systematic positioning threshold converge.

This latter region is particularly relevant because TD Securities previously identified $4,300 as a level capable of encouraging additional short covering among CTAs. A recovery above that threshold could therefore generate incremental buying pressure as systematic strategies adjust their positions. Further upside would bring the 200-day SMA near $4,524 into focus, although such a recovery would require a more convincing improvement in market conditions.

For now, the daily chart suggests that Gold is attempting to establish a base rather than confirming a bullish reversal.

The next Gold move may depend on who runs out of conviction firstThe latest inflation report appears to strengthen the bearish case for Gold. Consumer prices are accelerating, the Fed is considering additional tightening, and systematic traders are increasing their selling pressure.

Yet the market's response reveals a more complicated picture. Gold has recovered from its post-CPI decline, Treasury yields have reversed their initial increase, and buyers continue to emerge around a support region that has repeatedly contained losses.

The contrast between speculative selling and persistent underlying demand is becoming increasingly important. If inflation remains elevated and long-term Treasury yields resume their advance, systematic selling could intensify and eventually overwhelm the demand supporting Gold around $4,100.

But if Treasury yields continue retreating while Gold maintains its broader $4,100-$3,940 support region, bearish positioning could become a source of future buying pressure rather than a permanent obstacle.

The most important signal may therefore be not how aggressively investors sell Gold after unfavorable economic news, but how little additional downside that selling ultimately produces.

For now, $4,100 is not a confirmed bottom. But the repeated willingness of buyers to defend the area suggests that the market is not yet ready to treat it as the edge of a cliff.

Silver attempts to stabilize near $55 as surging U.S. producer prices and uncertain industrial demand threaten the durability of any short-term rebound.

Silver has to deal with a substantial producer price increase on Thursday, as the BLS reported that September final-demand PPI rose 1.3% month-on-month, seasonally adjusted, and 6.3% from a year earlier, unadjusted. The measure excluding food, energy, and trade services increased 0.5% monthly.

U.S. producer prices rose 10.8% for energy, 2.6% for all goods, and 0.8% for services in September 2026. The composition matters as much as the headline for the silver market, as final-demand energy prices rose 10.8% monthly, compared with 2.6% for goods overall and 0.8% for services. Goods excluding food and energy increased 0.3%. These categories overlap, so their percentage changes are not necessarily an additive contribution to the headline index.

Mixed Industrial Signal The report creates a mixed industrial signal. Higher selling prices can reflect pressure on purchasing power, as traders have to determine whether or not there is a volume increase in goods being produced or if it is just simple component pricing. The monetary channel can be more immediate. Persistent inflation could make policymakers less comfortable with easing and could sustain future financing costs, which are somewhat elevated.

For a non-yielding investment position in something like silver, competing returns can be a headwind. For an industrial user, financing and input expenses can affect inventory decisions. These are economic mechanisms, not verified explanations for a particular silver price movement today, but something worth watching.

Distinction Between Prices and Quantities Is Especially Useful Here The Federal Reserve’s latest completed decision was its September 16 increase in the federal funds target range to 3.75% to 4%. Its statement emphasized elevated inflation. Today’s PPI may add more information relative to that policy debate, but it does not necessarily change the policy rate itself.

The latest official daily Treasury observations also precede the release. The 2-year nominal par yield was 4.82% yesterday, compared with 4.79% the day before. Meanwhile, the 10-year real yield declined to 2.84% from 2.88%. These movements show why silver’s financing backdrop should not be reduced to a simple blanket statement that all yields are rising.

Yesterday’s CPI Yesterday’s consumer price report adds some context as well. Headline CPI rose 0.6% monthly, seasonally adjusted, and 3.7% annually, unadjusted. Alongside today’s producer data, it keeps inflation relevant to the monetary discussion. Neither index directly measures purchases of silver, and their different coverage prevents a mechanical comparison of headline news.

That being said, this is a market that will continue to be somewhat based around competing focuses, with industrial activity highlighted by the Federal Reserve production report from September 18 covering August. It says manufacturing output declined 0.3%, while total industrial production was unchanged. The manufacturing index was 98.2 against July’s 98.4, with 2007 equal to 100 as a measuring guide.

Silver Price Forecast

Every new Silver analysis as it publishes, today's technical signal and key levels, live price — on one page.

See all Silver forecasts A manufacturer facing higher costs has to reduce production, maintain output, or pass costs to consumers. Each outcome has different implications for silver use. Without newer activity data, the PPI acceleration alone cannot resolve whether industrial demand is absorbing pressures.

Silver’s electrical and electronic applications provide a reason to watch manufacturing, as documented by the U.S. Geological Survey. However, aggregate U.S. output is only a broad indicator. It cannot establish demand across each end use, and it does not capture the entire global silver market.

Tomorrow’s industrial production release, scheduled at 9:15 a.m. Eastern, is an important next test. Firmer activity alongside stable financing conditions would support a more constructive interpretation. Weaker production combined with rising real yields would create an even more difficult combination for the industrial case of silver.

Technical outlook

Silver futures trade near $56.82, below the $60 resistance level and above the $55 support area. The silver market finds itself testing the crucial $55 level and is seeing some relief. I suspect that the market is trying to find its footing, and short-term opportunities ot the upside could continue. However, I also see this as a short-lived scenario as the fundamentals continue to sour.

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Summary:

EUR/USD fell over 2% to multi-month lows near 1.1155, a move spurred by French budget deficit anxieties and persistent US-Eurozone yield differentials. This euro decline reflects significant macroeconomic hurdles, including widening French bond spreads, high global energy import costs, and sluggish European growth. With debt close to 119% of GDP, a 5% deficit, and rising borrowing needs for 2027, a lasting risk premium has formed ahead of French elections. The euro has had a rough patch lately. Concerns over French debt, a strong dollar, and changing interest rate expectations have driven EUR/USD to its lowest point in over a year. After falling to a 17-month low near 1.116 in early October, the pair has mostly traded sideways in recent days.

The pair picked up notably two days ago and is still gaining ground during European trading today, hovering around the 1.12 level. This makes you wonder if the downward trend has finally run its course.

Was the 2% Monthly Loss Justified or Overdone? When a major currency pair drops 2% in a month, it’s more than just short-term noise, but signals a shift in core expectations. Looking at the economic factors, it seems the euro’s decline stemmed mainly from economic realities, not an overreaction.

Concerns about French debt have been a primary driver. The difference in yield between 10-year French and German bonds widened significantly, nearing 160 basis points at one point. This level hasn’t been seen since the eurozone sovereign debt crisis over a decade ago.

France’s public debt is close to 119% of its GDP, with a deficit around 5%. Forecasts show the country’s borrowing needs could hit a record €340 billion by 2027. Political uncertainty leading up to the 2027 presidential election has added to the pressure, with Jean-Luc Mélenchon, a key political figure, suggesting measures like the central bank cancelling the French debt it holds.

Crédit Agricole, for its part, warns that bond spreads might widen even more. Fears of contagion, which once loomed large in the Eurozone, have resurfaced, even though the European Central Bank can handle extreme market stress. UBS, however, thinks the euro’s selling pressure might have gone too far.

A strong U.S. economy and the dollar’s role as a safe haven have kept it well-supported. Record speculative bets against the euro have also piled on technical selling pressure.

But perhaps the market’s reaction has overshot, moving beyond what underlying fundamentals suggest. France, for instance, isn’t facing an immediate solvency crisis. Its interest payments remain manageable relative to its GDP, and the broader Eurozone economy appears stable.

Earlier this month, French bond yields dropped, and the euro gained some ground back. This suggested the sell-off stemmed partly from market sentiment, not an irreversible fundamental decline.

Could a Rebound Be In the Works? The euro’s recent sideways trading and modest gains hint that selling momentum may be fading. Support near 1.11-1.116 has held firm through several tests. Should French yields stay steady and U.S. economic data soften enough to ease dollar strength, the EUR/USD pair might push toward 1.13.

Even so, any recovery will likely remain fragile until France shows clearer progress on its 2027 budget or finds more political stability.

So, while the euro’s recent losses certainly stem from real fiscal and political challenges in France, the sheer size of the drop also reflects a substantial risk premium.

We might see some stabilization, but a lasting recovery truly depends on real improvements in France’s fiscal plans and a more balanced economic policy between the U.S. and Europe.

The upcoming U.S. inflation data will largely determine if U.S. Treasury yields hold above 5% or decline. That, in turn, will influence the broader U.S. Dollar Index.

Why has EUR/USD declined since early September?

The euro’s drop against the dollar mainly stems from worries over French debt pushed the France-Germany bond yield spread much wider. Meanwhile, the U.S. economy stayed strong, and money flowed into the dollar as a safe bet.

Is the euro’s more than 2% monthly loss fully justified?

Yes, partly, because France faces real fiscal risks. However, the market’s reaction also seems to bake in an exaggerated risk premium. That premium might ease up if bond yields settle down.

How significant are French fiscal challenges for the euro?

With debt around 119% of GDP, a 5% deficit, and more borrowing needed in 2027, France’s financial situation is quite serious. This has built in a persistent risk premium for the euro, especially with elections coming up.

Gold bounced from dangerous zone on Thursday to fully reverse post-US CPI drop and fade immediate risk of eventual clear break below pivotal ($4120/00 support zone).

The metal price fell on hotter than expected US inflation in September that initially boosted bets for more aggressive Fed’s stance on monetary policy, but following comments from Fed officials that the central bank should stay on tightening path but with no urgency for action in October meeting, cooled the sentiment.

Another false break lower suggests that larger bears remain in play but need more evidence to spark final push through cracked $4120/00 levels that would signal bearish continuation and expose key $4000 support zone.

Technical picture on daily chart haven’t changed significantly, as momentum indicators remain in negative territory but climbing that supports near-term view of extended sideways mode, while MAs are in bearish configuration.

However, near-term action is expected to remain biased lower while the price stays in the lower side of the range ($4070/$4230) that would keep $4120/00 supports at increased risk.

Investors await release of US PPI data today for more information, with hotter than expected producer price index, likely to put more pressure on the yellow metal.

Res: 4170; 4201; 4230; 4245.
Sup: 4100; 4066; 4033; 4000.

The British Pound (GBP) retraces Wednesday’s losses against the US Dollar (USD) on Thursday, as upbeat UK macroeconomic data has offset the negative impact of Bank of England’s (BoE) Chief Economist Huw Pill's comments. The GBP/USD has returned to the mid-range of the 1.3200s, after testing year-to-date lows around 1.3140 the previous day, and approaches the last three weeks’ range top, at the 1.3300 area.

UK data released on Thursday revealed that the economy grew unexpectedly in August, with GDP up 0.1%, against the 0.1% contraction anticipated by market analysts and following a 0.4% growth in the previous month. These figures have been largely due to the stronger-than-expected UK industrial Production, which has offset the softer performance of the construction and services sectors.

In the US, hot Consumer Price Index (CPI) figures on Wednesday boosted hopes of a Federal Reserve (Fed) interest rate hike in October, but some central bank officials poured cool water, playing down the possibility of back-to-back rate hikes, and triggering a significant pullback in US Treasury yields and the US Dollar.

Technical Analysis: The Pound might have found a bottom at the 1.3140 area

GBP/USD trades at 1.3257, with a neutral near-term tone as the pair consolidates its recovery from Wednesday's lows, with bulls looking at the top of the last few weeks' trading range, at the 1.3300 area. The Relative Strength Index (14) around 55 suggests balanced, modestly positive momentum, while the Moving Average Convergence Divergence (MACD) has turned slightly positive but remains close to zero, reinforcing the idea of a range-bound market rather than a directional breakout.

A clear break of the mentioned 1.3300 level and, preferably, with a continuation above the 38.2% Fibonacci retracement level of 1.3345 would confirm the completion of a five-wave (Elliot Wave) cycle. That scenario would bring the mid-September highs, just above 1.3400, into focus, ahead of the 61.8% Fibonacci retracement at 1.3470.

On the downside, a bearish reaction below Wednesday's low at 1.3137 cancels this view and exposes the November 2025 lows at 1.3030 and 1.3010.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Pound Sterling Price Today The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.

USDEURGBPJPYCADAUDNZDCHFUSD-0.54%-0.49%-0.32%-0.28%0.75%-0.31%-0.59%EUR0.54%0.04%0.21%0.27%1.31%0.21%-0.06%GBP0.49%-0.04%0.17%0.21%1.24%0.19%-0.12%JPY0.32%-0.21%-0.17%0.02%1.09%-0.02%-0.29%CAD0.28%-0.27%-0.21%-0.02%1.04%-0.02%-0.31%AUD-0.75%-1.31%-1.24%-1.09%-1.04%-1.06%-1.35%NZD0.31%-0.21%-0.19%0.02%0.02%1.06%-0.30%CHF0.59%0.06%0.12%0.29%0.31%1.35%0.30% 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 British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).

USD/JPY – Bearish continuation as yield differentials narrow

Silver price today: Silver rises, according to FXStreet data

AUDUSD is one of the weakest currencies right now, and after a very disappointing Australian jobs report, the sell-off has picked up speed. Unemployment rose from 4.6% to 4.7%, while employment fell by 39K instead of rising, so the RBA does not have much room for higher rates.

On the 4H chart, the rebound from the October low looks corrective, with several overlaps. I see it as a wave 4 bounce that stopped just below the 0.7000 resistance. Price has now broken the lower line of the corrective channel I have been following, which suggests that wave 5 lower is in progress.

If that is the case, the next targets are below 0.6900 and then the 0.6860 to 0.6813 support area. That zone is also important on the daily chart, where the decline from the September high looks like a counter-trend wave C. This is where the whole correction could end.

For now, more short-term weakness is possible, especially if stocks stay in risk-off mode and tech keeps falling, which can weigh on commodity currencies. I will stay with this view as long as price stays below 0.7074. But once price reaches the support area, I will be looking for signs of a bottom, because the long-term picture from the 2025 lows still looks bullish.

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The US Dollar (USD) trades lower against the Japanese Yen (JPY) on Thursday as US Treasury yields extend their reversal from multi-decade highs after the Federal Reserve (Fed) cooled hopes of back-to-back interest rate hikes. The USD/JPY pair trades at 158.00 with bears looking at the bottom of the last two weeks’ trading range, at the 157.50 area.

US Treasury yields climbed following hot US CPI figures Wednesday to retreat sharply after Fed officials dampened market expectations of an October rate hike. The yield of the benchmark 10-year note has dropped by more than 30 basis points from Wednesday's highs, hitting three-week lows at 5.09%, pushing the US Dollar lower across the board.

In Japan, macroeconomic data has been mixed, with Machinery Orders increasing beyond expectations in August, although the country’s Industrial Production for the same month was revised lower.

Also on Thursday, Bank of Japan (BoJ) board member Junko Koeda joined the recent chorus of hawkish BoJ policymakers and called for further rate hikes, amid increasing inflationary risks, although the impact on the Yen was limited.

Technical Analysis: Support at 157.50 comes under pressure as bullish momentum fades

The USD/JPY trades at 157.91, with the near-term bias still bullish but with indicators showing a growing bearish momentum after another rejection at the 159.00 area on Wednesday. The 4-hour Relative Strength Index (14) has dipped below the 50 level, and the Moving Average Convergence Divergence (MACD) is slightly negative, hinting at consolidation rather than outright reversal for now.

Bears should confirm below the 157.50 area, which has capped downside attempts several times over the last two weeks, to increase pressure towards the late September lows at 156.36. A break of that level would highlight a double top at 159.00 and expose the September 17 low, near 155.35.

On the topside, initial resistance is located at the mentioned 159.00 area (September 24, October 14 lows), followed by the 160.00 psychological area and the September 2 high near 160.40.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Japanese Yen Price Today The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Australian Dollar.

USDEURGBPJPYCADAUDNZDCHFUSD-0.60%-0.53%-0.38%-0.27%0.60%-0.42%-0.76%EUR0.60%0.07%0.21%0.31%1.23%0.18%-0.17%GBP0.53%-0.07%0.15%0.24%1.13%0.09%-0.25%JPY0.38%-0.21%-0.15%0.10%1.01%-0.05%-0.39%CAD0.27%-0.31%-0.24%-0.10%0.89%-0.13%-0.49%AUD-0.60%-1.23%-1.13%-1.01%-0.89%-1.02%-1.37%NZD0.42%-0.18%-0.09%0.05%0.13%1.02%-0.36%CHF0.76%0.17%0.25%0.39%0.49%1.37%0.36% 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 Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

Key Points:Hotter-than-expected U.S. CPI briefly lifted October Fed rate-hike odds to 50%, but dovish signals from policymakers and falling Treasury yields weighed on the dollar.DXY rebounds from 101.93 and holds near 102.15, with a breakout above 102.39 potentially targeting 102.87 and 103.20, while 101.93 remains critical support.EUR/USD recovers from 1.1112 but remains below its descending trendline, with a breakout above 1.1237 potentially exposing 1.1278 and 1.1316.GBP/USD tests the 1.3255–1.3281 resistance zone after stronger UK GDP data, with a sustained breakout targeting 1.3311 and 1.3344, while 1.3215 remains immediate support.Dollar Index: Hot CPI Meets a Sharp Treasury Rally The U.S. dollar’s backdrop became more mixed on Thursday. U.S. inflation for September was released, and came in hotter than expected. As a result, expectations for another rate hike by the FOMC this month increased, briefly pushing the probability of an October hike to 50%. However, FOMC officials followed with commentary stating there was no need for urgency to hike at the next meeting. Current expectations favor the Federal Funds Rate remaining at the current target range of 3.75%-4.00% after the conclusion of the October 27-28 FOMC meeting.

The bond market is providing the primary counterweight. The 10-year U.S. Treasury yield fell to 5.0933% and the 30-year U.S. Treasury yield fell to 5.4462%. Both yields posted 3-week lows. Rising government bond prices indicate a flight to safety.

EUR: French Inflation Complicates an Already Difficult Fiscal Picture Fundamentals continue to be dominated by France. French EU-harmonized inflation accelerated to 3.4% year over year in September from 2.6% in August. It is the highest level since January 2024.

Accelerating French inflation adds to concerns about persistent price pressures across the eurozone, while France’s fiscal difficulties continue to weigh on investor confidence. These competing forces complicate the euro’s outlook as the ECB assesses the appropriate path for monetary policy.

GBP: Growth Surprise Strengthens the BoE Tightening Case The surprise growth in the UK in August provided a boost for Sterling. UK GDP unexpectedly increased 0.1%, versus a decline of 0.1% that was expected for the month. Annual growth increased to 2.1% and manufacturing output for the month increased by 1.2%.

BoE Chief Economist Huw Pill said a future rate hike should not be interpreted as the beginning of a prolonged tightening cycle. Markets nevertheless expect a 25-basis-point increase at the November 5 policy meeting.

U.S. Dollar Index Technical Analysis: DXY Rebounds From 101.93 as 102.39 Caps the Recovery

Dollar Index Price Chart – Source: Tradingview The US Dollar  Index is currently trading near 102.15, after bouncing sharply from the 101.93 support area on the 2-hour time frame. Currently, the Dollar is trading above the short-term moving average, however, it is still trading below the 102.39 resistance level, after being rejected from the 102.87 area. This keeps the near-term recovery intact, although further upside may require a sustained break above 102.39.

The first area of interest is the 102.39 resistance area. Should 102.39 break, 102.87 would come into play and be followed by 103.20. Looking at the downside, the 101.93 area would be the first area to watch, followed by 101.60, 101.32 and 101.02.

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See all EUR/USD forecasts RSI is hovering near 50, indicating neutral momentum as neither buyers nor sellers have established a clear advantage. With the Dollar trading above 101.93, I would remain slightly bullish. A clear break above 102.39 would increase the probability of a move to the 102.87 area. A clear move below 101.93 would increase the probability of a larger decline in the Dollar.

GBP/USD Technical Analysis: Sterling Breaks Trendline as 1.3284 Becomes the Next Upside Test

GBP/USD Price Chart – Source: Tradingview The GBP/USD is currently trading at 1.3242 on the 2-hour chart, and has bounced hard from the 1.3146 support area. What’s interesting is the price has bounced above 1.3215 and the 20-period moving average, but has reached the descending trendline and the 1.3255-1.3281 resistance area. Because of this, I believe the price action in this area will be pivotal for the next direction of the market.

From a trading perspective, 1.3255 is the first area of interest, and a rejection from that resistance could bring 1.3215 back into focus. If the price breaks above the 1.3281 area, the next target will be 1.3311, then 1.3344.

RSI is currently about 50, indicating neutral momentum rather than confirming that the recovery is complete. A sustainable move above 1.3281 will trigger a bullish recovery toward 1.3311, and a break below 1.3215 will reinforce the 1.3181 area. I am overall neutral on GBP/USD.

EUR/USD Technical Analysis: Euro Tests Descending Trendline as 1.1233 Becomes the Breakout Trigger

EUR/USD Price Chart – Source: Tradingview EUR/USD is trading near 1.1211 on the 4-hour chart after bouncing up from 1.1112. Price has since moved above 1.1153, but it remains below the descending trendline and the shorter- term moving average. The broader technical structure remains bearish.

The first area of resistance is at 1.1237. Should price break through that level, the next area of resistance is at 1.1278 and the final area of resistance is at 1.1316. The first area of support is at 1.1153. The second area of support is at 1.1112. The final area of support is at 1.1071. Support may be tested if the rebound fails.

RSI is in the bullish territory and has improved from the previous oversold territory. I am neutral to bearish with a slightly bearish bias while EUR/USD remains below 1.1237 and the descending trendline.

Should EUR/USD break above 1.1237, that would improve the chances of a further rebound. Should it break below 1.1153, that would put 1.1112 back in focus.

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

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United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann report GBP/USD’s sharp swing between 1.3275 and 1.3137 before closing at 1.3196. Short term, recovery is expected to extend toward 1.3260 but is unlikely to sustain above that level. Over the next one to three weeks, price action is viewed as range expansion, with the Pound likely confined between 1.3135 and 1.3280.

Pound trapped in broader range"24-HOUR VIEW: After GBP rose to a high of 1.3259 two days ago, we indicated yesterday that “the advance has scope to extend, but with no significant increase in upward momentum, GBP may not break the major resistance at 1.3280.” We added, “to sustain the momentum, GBP must hold above 1.3230.” The subsequent price action did not unfold as expected. GBP rose to 1.3275 but then it plunged to a low of 1.3137. The decline was brief, as GBP rebounded strongly from the low to close at 1.3196 (-0.45%), with the recovery extending into the early Asian session today. The recovery could extend to 1.3260. Based on the prevailing momentum, a continued rise above this level is unlikely. On the downside, a breach of 1.3180 (minor support is at 1.3205) would mean GBP is more likely to range-trade rather than continuing to recover."

"1-3 WEEKS VIEW: We highlighted on Monday (12 Oct, spot at 1.3235) that GBP “is expected to trade in a range between 1.3170 and 1.3280.” Yesterday, GBP rose close to 1.3280 with a high of 1.3275 before plummeting to a low of 1.3137. GBP rebounded sharply from the low. The price action did not result in any clear increase in downward momentum. The decline to 1.3137 appears to be more of a range expansion rather than the start of a sustained decline. From here, we expect GBP to trade between 1.3135 and 1.3280, and GBP must clearly break either of these levels before a more directional move can be expected."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

The NZD/USD pair trades in positive territory around 0.5605 during the early European trading hours on Thursday, bolstered by a weaker US Dollar (USD) and a sharp drop in US Treasury bond yields. The US September Producer Price Index (PPI) and Retail Sales data will take center stage later on Thursday.

Traders assess the likelihood of a US Federal Reserve (Fed) interest rate increase this month after a hot inflation report. The US Consumer Price Index jumped 0.6% MoM in September, putting the 12-month rate at 3.7%, according to the Bureau of Labor Statistics on Wednesday. Economists expected gains of 0.6% and 3.6%.

The core CPI, stripping out volatile food and energy costs, increased 0.3% for the month and rose 2.6% on an annual basis, compared with respective estimates of 0.2% and 2.5%.

Markets are now pricing in nearly a 29.3% probability of a rate hike later this month, compared with 22% before the CPI data, the CME FedWatch Tool showed.

San Francisco Fed President Mary Daly said the US central bank will probably need to hike short-term interest rates further, though she signalled no need for a rate increase at the October 27-28 meeting. Meanwhile, Fed Vice Chair for Supervision Michelle Bowman said there's time to wait and see before any more action.

Daly stresses deliberate path on rates as inflation risks stay elevatedThe FXS Speechtracker score of 6.8/10 marks a modestly more hawkish tone relative to the historical average of 6.1/10, underscoring persistent concern about inflation despite a cautious policy stance. Daly’s emphasis that gas-driven headline CPI is rising while core inflation remains “stubborn,” coupled with the remark that more rate hikes are “likely” but timing is still under consideration, signals a bias toward further tightening even as the Fed avoids rushing decisions. The focus on elevated inflation risks, a steady labor market, and the importance of clear, accountable communication suggests the Fed is comfortable maintaining a restrictive stance while watching how shocks and market reactions evolve.

The FXS Fed Sentiment Index slipped by 0.84 points to 128.17, indicating a slight pullback in perceived hawkishness. With the index still well above the neutral 100 level, the Fed remains firmly in hawkish territory despite the marginal softening, aligning with Daly’s message of likely further tightening but in a measured, deliberate fashion as captured by the FXS Speechtracker.

Technical Analysis: NZD/USD maintains a bearish outlook in the near termIn the daily chart, NZD/USD holds below the 20-day simple moving average (SMA) from the Bollinger Bands and well under the 100-day moving average, keeping the near-term bias bearish despite a modest rebound from recent lows. Price is also capped beneath the Bollinger upper band, while the Relative Strength Index (14) near 36 suggests fading downside momentum but not yet a decisive recovery.

On the downside, immediate support level emerges at the lower limit of Bollinger band around 0.5550, where sellers could hesitate on further declines. A desicive break below this level could expose the April 8, 2025 low of 0.5520, followed by the 0.5500 psychological level. 

On the topside, initial resistance level stands at the Bollinger SMA middle band at 0.5640, en route to the upper boundary of Bollimger band near 0.5725. Sustained trading above the mentioned level could see a rally to the 100-day moving average at 0.5785, which act as a stronger medium-term barrier that would need to be reclaimed to soften the broader bearish tone.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

New Zealand Dollar FAQs

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.

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.

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.

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.

The Pound-New Zealand Dollar rate could face further pressure if UK GDP contracts, while risk appetite may determine whether the Kiwi can extend its recovery. The Pound to New Zealand Dollar (GBP/NZD) exchange rate was muted on Wednesday after a notable Bank of England (BoE) policymaker expressed scepticism about market pricing for future interest rate hikes.

At the time of writing, GBP/NZD was trading at around NZ$2.3591. A modest decline from the start of Tuesday's session.

Latest — Exchange Rates:

Pound to New Zealand Dollar (GBP/NZD): 2.362755 (+0.05%)

Euro to New Zealand Dollar (EUR/NZD): 1.993349 (-0.10%)

New Zealand Dollar to Dollar (NZD/USD): 0.561552 (+0.03%)

DAILY RECAP:

The Pound (GBP) faced headwinds on Wednesday, following comments by Bank of England Chief Economist Huw Pill on the sidelines of the International Monetary Fund’s (IMF) annual meeting in Bangkok.

Huw spoke about the need for the bank to begin tightening monetary policy but questioned the wisdom that the BoE will deliver four interest rate hikes over the next year.

Current market pricing suggests there is a 92% chance of the BoE raising rates by 25 basis points in November, with three more 25bps hikes following before September 2027.

As one of the most hawkish members of the BoE’s Monetary Policy Committee (MPC), Pill’s comments should raise some doubts amongst the more bullish GBP investors who are pushing the four-hike narrative.

The New Zealand dollar (NZD) appreciated during Wednesday’s Asian session, with the ‘Kiwi’ drawing support from a sharp improvement in Chinese trade data

Figures revealed that China’s trade surplus widened to $133.53bn in September, marking its largest monthly surplus in 20 months and comfortably exceeding market expectations.

In addition to underpinning a broader improvement in risk appetite, the data provided a particular boost to those currencies closely linked to the Chinese economy, such as the New Zealand and Australian Dollars.

However, analysts cautioned that September’s trade data primarily reflected strong overseas demand for Chinese goods rather than a decisive recovery in domestic consumption, which raises questions about whether the jump in import growth can be sustained.

Near-Term GBP/NZD Forecast: Contraction in GDP to Sink Sterling? Looking ahead to the second half of the week, the Pound to New Zealand Dollar (GBP/NZD) exchange rate could come under more notable pressure on Thursday, with the release of the UK’s latest GDP figures.

Consensus forecasts predict month-on-month growth contracted in August, further constricting the amount of fiscal headroom available to Chancellor John Healey as he prepares to deliver his first Autumn Budget later this month.

Meanwhile, in the absence of any impactful NZ data, movement in the ‘kiwi’ will be tied to market risk dynamics, with NZD potentially faltering if the US Dollar (USD) resumes its bullish run following the publication of the latest US inflation figures.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

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