Gold Price Outlook: Gold's Longer-Term Buyers and Short-Term Traders Are Pulling Apart BofA's gold forecast allows for a weaker finish to 2026 before a 2027 recovery, while HSBC's demand case faces competition from yields and the Dollar. Bank of America expects gold's recovery to lose some momentum later in 2027, with $5,000 an ounce marking the strongest part of its quarterly forecasts.
Its projections put bullion at $4,000 in the fourth quarter of 2026 and $5,000 in the second and third quarters of 2027, before a 10% retreat in the final quarter.
At the time of writing, spot gold traded near $4,166 an ounce, down 0.12% on Tuesday, after losing 6.64% during September.
HSBC sees demand support despite higher yields HSBC Asset Management retains a positive bias towards gold over an investment horizon exceeding 12 months.
Its October assessment says: "The gold price has been resilient, supported by central-bank demand, investment inflows, and macroeconomic uncertainty. Momentum remains constructive despite intermittent volatility and shifting rate expectations. Geopolitical risks and reserve diversification should support prices, but elevated yields and a stronger US dollar remain risks".
Gold pays no interest, so higher bond returns raise the income investors forgo by holding it.
The US Treasury's 10-year yield stood at 5.24% on 9 October, illustrating the competition bullion still faces.
Goldman's trading desk noted on 9 October: "Even with US real rates at multi-decade highs, gold has held above $4,100/oz, reinforcing its appeal as a hedge against geopolitical risk and rising fiscal strain."
HSBC also expects the US currency to remain supported initially: "Near-term, the dollar is expected to be supported by the resilient US economy, Fed tightening, favourable rate differentials, and heightened geopolitical risk and safe-haven demand. On longer-term valuation measures, the dollar still looks expensive. Structural diversification away from the dollar remains a long-term theme".
A dearer Dollar makes bullion more expensive for buyers using other currencies, even when they want protection from geopolitical or fiscal risks.
Image: Gold price in USD 48-hour chart. Goldman's desk sees room for investors to rebuild exposure Goldman Sachs's desk also sees potential for renewed buying: investors following systematic strategies have already cut their exposure sharply.
Its latest US Equities Weekly Rundown says: "Gold showed resilience, rising 1.3% WoW as the FOMC rate-path outlook looks more stable and the UST market found modest relief following the 10-year and 30-year auctions. Despite a challenging macro backdrop, sustained central-bank buying and persistent ETF inflows continued to underpin prices".
Gold has weakened since the report's 9 October cutoff.
The World Gold Council's September review shows how uneven investor demand has been: "Yet September was unusual: despite the price decline, global gold ETFs recorded US$10bn (67t) of inflows across regions."
Futures selling can outweigh those purchases over shorter periods, the divergence examined in our recent UBS gold outlook.
Goldman's desk writes: "Investor positioning has reset meaningfully: systematic strategies are very short, at the 0th percentile on a 1yr lookback per GS' models, while CFTC managed-money net length has normalized to average levels".
The distinction between deeply bearish systematic strategies and average managed-money exposure leaves room for some investors to return without assuming the whole market is underinvested.
Price gains could prompt bearish traders to buy back positions.
Goldman's desk makes that prospect conditional: "This should create a favorable setup if recent momentum persists."
Gold price predictions FAQ What is Bank of America's gold forecast?
BofA projects $4,000 an ounce for Q4 2026 and $5,000 for Q2 and Q3 2027, followed by a 10% decline in its Q4 projection.
Why does HSBC remain positive on gold?
HSBC cites central-bank demand, investment inflows, geopolitical risks and reserve diversification, while warning that high yields and a stronger Dollar can weigh on prices.
What does Goldman's gold positioning analysis show?
Its desk says systematic strategies are at the bottom of their one-year positioning range. A sustained price rebound could encourage renewed buying.
EUR/USD rises from 17-month low but French fiscal and political concerns linger
The euro/U.S. dollar is recovering from a fresh 17-month low near 1.1150 and hovers just above 1.12 at the time of writing, although the broader bearish structure remains.
French fiscal and political concerns could continue to weigh on the euro. President Emmanuel Macron's government is anxious to pass a budget before the end of the year as it seeks to reassure markets that France can bring down its debt mountain. However, in political jostling ahead of next year's presidential election, opposition parties oppose the government's proposals.
The 10-year yield has risen as high as 4.5% in recent days, but the finance minister insists that France has not yet caught an adverse snowball effect. However, surging costs could spiral into a full-blown debt crisis if action isn't taken soon.
Budget talks have started, and the Socialist motion against the budget was denied after failing to pass an initial hurdle. However, France may need to experience more market pressure before significant progress is made.
The ECB is expected to hike rates once more before the end of the year. The Belgian central bank governor has joined the chorus of policymakers saying that the ECB will probably have to hike rates again. His comments come as inflation data is due later this week and is set to approach 4%, well above the ECB's 2% target.
Growth has been surprisingly resilient, given the energy price spike triggered by the conflict in the Middle East. However, ECB President Christine Lagarde has warned that an escalation in the war remains a key risk, and surging bond yields will weigh on activity more than previously expected. Lagarde also noted that elevated euro area inflation, driven by higher prices, is yet to feed into the broader economy.
Should French debt suffer heavier losses, the ECB may be forced to abandon rate hikes, which could see the euro come under more pressure.
The U.S. dollar is trading cautiously just below 18-month highs ahead of U.S. CPI data. Stronger-than-expected data could raise Fed rate hike expectations and lift the U.S. dollar, creating a headwind for EUR/USD.
EUR/USD forecast – technical analysis
The euro/U.S. dollar has extended its move southwards, falling to a fresh 18-month low of 1.1155 before recovering to 1.12 at the time of writing. This has helped bring the RSI out of oversold territory.
Sellers will look to break below 1.1155 to extend the move southwards towards 1.11 and 1.10, the psychological level.
Any recovery first needs to rise above 1.12. Above here, attention turns to 1.13, the 20 EMA, before the 1.1350 resistance zone and the 50 EMA at 1.1410 come into focus.
USD/JPY looks to US CPI data
USD/JPY is struggling to extend yesterday's bounce, with few signs of meaningful traction on Wednesday amid mixed fundamental cues.
The U.S. dollar is broadly flat as investors look cautiously ahead to the release of U.S. inflation data.
U.S. CPI is expected to show that inflation rose by 0.6% month on month in September, up from 0.4% in August. However, core inflation, which excludes more volatile items such as food and fuel, is expected to ease to 0.2%, down from 0.3%. Inflation data will be followed by PPI figures on Thursday and Federal Reserve Chair Kevin Warsh's speech on Friday, where he may provide more clues on the policy outlook.
The market is currently pricing in a 20% probability of a rate hike in October, but still an 85% probability of a hike before the end of the year. New York Fed President John Williams said the Fed would likely need to hike rates before the end of the year. However, he added that he did not see any rate hikes in 2027.
Hotter-than-expected inflation could see the market reprice Fed rate hike expectations higher, boosting U.S. yields and the dollar.
Meanwhile, reports that Bank of Japan officials are leaning against a rare back-to-back interest rate hike are undermining the Japanese yen and acting as a tailwind for the pair.
Bank of Japan Governor Ueda said policymakers would continue to closely monitor bond yields, reiterating that long-term interest rates should be determined by market forces.
The yen is also under pressure amid rising oil prices as hostilities in the Middle East escalate, raising concerns over supply disruption.
USD/JPY forecast – technical analysis
USD/JPY has extended its recovery from the 152.90 low to a peak of 158.75. The price trades above its rising trend line and the 250 EMA, while the RSI is also above 50, keeping buyers hopeful of further upside.
Buyers will look to rise above 159, the September 24 swing high, before attention turns to the 160 resistance zone.
On the downside, immediate support is seen at the 50 EMA at 158.10 and the 200 EMA at 157.70. Below here, attention turns to 157.25 horizontal support, below which sellers could gain traction towards 155.
USD/CAD fell over 0.4% after a sharp rejection at the 1.4300 resistance ceiling, returning to its range between 1.4200 and 1.4299
Factors holding back CAD's potential gains include wider US-Canada interest rate gaps, the Bank of Canada's dovish policy, and slow domestic economic activity
To keep the downtrend going, it'll need to break clearly below 1.4200. Traders also need to look for weaker momentum indicators and fundamental confirmation from narrower rate differences
The USD/CAD pair closed yesterday down over 0.4% and opened lower today. It’s been stuck in a tight range, roughly around 1.4200-1.4299, for a few days. The recent high touched 1.4300, a key psychological and technical level, before pulling back. We discuss what this means for the pair’s outlook
Has the Rejection at 1.4300 Triggered a Reversal?
A sharp retreat from a resistance level held for months might signal weakening upward momentum. But figuring out if this is just a short-term correction or a real trend shift means a close look at the market’s structure.
On the daily chart, the pair still moves within an upward channel from September. The 18-month high it hit on October 9th, around 1.4298, has acted more like a ceiling than a springboard for further gains.
A clear daily close below the nine-day exponential moving average, now around 1.4220-1.4235, would start to chip away at the short-term positive structure.
Should the pair consistently trade under 1.4200, it might head for the channel’s lower boundary, estimated at 1.4110-1.4130, and the 50-day EMA near 1.4060. But until those levels break, the pullback from 1.4300 looks like a temporary pause in an uptrend, not a confirmed reversal.
What Is Needed to Sustain the Downtrend?
While the pair stays above 1.4200, expect the current trading range to hold, and 1.4300 remains a caution point. One trading session under the range’s floor isn’t enough to show a trend change. However, a confirmed close below it would definitely shift the market’s structure.
Additionally, the Canadian dollar needs the US dollar to weaken to gain ground. Right now, the US Dollar Index sits near an 18-month high, making that a bit more difficult. Plus, the Federal Reserve hiked interest rates in September, their first increase in over three years.
All eyes are on today’s US inflation report. A hotter-than-expected number might boost expectations for more Fed rate hikes, probably helping the dollar. If the reading comes in lower, however, it could spark renewed bets on rate cuts. A cooler inflation report could give sellers the push they’re looking for.
For USD/CAD to see a lasting decline, oil prices need to remain elevated. As a major crude oil exporter, Canada directly gains from higher West Texas Intermediate (WTI) prices. A strong rebound in energy prices usually helps Canada’s trade balance and props up its dollar.
What Could Disrupt CAD Gains?
The Bank of Canada (BoC) has kept a cautious monetary policy, holding its benchmark interest rate below the Federal Reserve’s. This rate gap makes US dollar assets more appealing for their yield, potentially drawing institutional investors to buy USD/CAD on dips.
Should Canada see any surprise weakness in its employment numbers or consumer spending, the BoC might well think about cutting rates again. That would probably hurt the Canadian dollar.
Statistics Canada reported 68,000 fewer jobs in September, pushing the unemployment rate to 6.5%. This kind of data makes a quarter-point rate cut on October 28th look more likely. If the BoC cuts rates while the Federal Reserve keeps its policy rate steady, that’ll probably weigh down the Canadian dollar.
Ongoing trade tensions between the US and Canada also put pressure on the Canadian dollar. Any negative news about tariffs could quickly reverse recent positive gains.
Did the rejection near 1.4300 confirm a reversal in USD/CAD?
Not quite. The pair’s still within its ascending channel. We’d need a sustained break below 1.4200 for the bias to really turn lower.
How do interest-rate differentials influence the pair?
The significant rate difference between the Fed and the Bank of Canada continues to favor the U.S. dollar. This also limits the Canadian dollar’s potential gains right now.
Which upcoming macroeconomic data releases present the biggest volatility risk for USD/CAD?
Keep an eye on US CPI inflation reports, Canadian labor market data, and the next central bank policy announcements from both the Fed and the Bank of Canada. These events will truly dictate the USD/CAD’s direction.
The British Pound (GBP) is trading flat, just below the top of the last three weeks' trading range against the Japanese Yen (JPY) on Wednesday, buoyed by the UK government's pledge of fiscal responsibility. The GBP/JPY pair changes hands at 210.00 at the time of writing, with bulls aiming to break a resistance area around 210.20, which has capped rallies several times in the last few weeks.
A report by the Financial Times newspaper highlights that the UK Chancellor, Jon Healey, plans to finance the new measures in the budget with spending cuts or higher taxes instead of additional debt. Before that, the International Monetary Fund (IMF) revised the UK’s 2026 growth prospects to 1.3% from the previous 1% and stated that the government does not need to accelerate the pace of fiscal consolidation, which provided a fresh impulse to the Sterling.
The Japanese Yen, by contrast, remains on the back foot after softer-than-expected Japanese Producer Price Index (PPI) figures on Monday, and comments from Bank of Japan (BoJ) officials pointing to steady monetary policy at October’s meeting. BoJ Governor Kazuho Ueda reiterated the importance of keeping inflation anchored near the 2% target, but he did not mention any timing for a further monetary tightening move.
Technical analysis: Trading above the top of a triangle pattern
GBP/JPY bulls have pierced the top of a triangle pattern and are targeting the resistance area around 210.20 to confirm the bullish breakout. Momentum indicators in 4-hour charts reinforce that view, as the Relative Strength Index (14) crossed above the 60 level with the Moving Average Convergence Divergence (MACD) slightly positive, hinting that bullish momentum is building.
A clear break of the 210.20 area (September 23 and 24 and October 7 highs) will expose the area between the September 18 high, at 211.28, and the September 4 high, at the 211.80 area.
On the downside, immediate support is at Tuesday's low of 208.90, where the triangle bottom lies, ahead of the October 5 and 8 lows near the 208.20 area and the late September lows at 206.90.
(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 Swiss Franc.
USDEURGBPJPYCADAUDNZDCHFUSD-0.01%-0.03%0.05%-0.01%-0.36%-0.14%0.08%EUR0.00%-0.03%0.07%0.00%-0.37%-0.16%0.08%GBP0.03%0.03%0.08%-0.00%-0.33%-0.13%0.11%JPY-0.05%-0.07%-0.08%-0.05%-0.42%-0.19%0.04%CAD0.01%-0.00%0.00%0.05%-0.35%-0.15%0.08%AUD0.36%0.37%0.33%0.42%0.35%0.22%0.43%NZD0.14%0.16%0.13%0.19%0.15%-0.22%0.23%CHF-0.08%-0.08%-0.11%-0.04%-0.08%-0.43%-0.23% 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/IDR holds ground after posting modest losses the previous day, trading around 17,930 during European hours on Wednesday. The upside for the pair remains limited as the Indonesian Rupiah (IDR) may gain support from Bank Indonesia's (BI) ongoing interventions across the spot, domestic non-deliverable forward (DNDF), and offshore NDF markets.
Moreover, the US Dollar (USD) struggles following dovish remarks from New York Federal Reserve President John Williams. Speaking on Tuesday, Williams noted that while he maintains his view that one more rate hike may be appropriate this year, he does not foresee additional rate increases in 2027. In response, the CME FedWatch Tool suggests markets are currently pricing in roughly a 77% probability that the Fed will leave interest rates unchanged this month, alongside an 88% chance of a rate hike in December.
Market focus now shifts to the US September CPI inflation data scheduled for release later in the North American session, which could offer clearer direction on the Federal Reserve’s monetary policy path. Headline U.S. CPI is expected to show a year-over-year rise of 3.6% in September, up from 3.4% in August. Meanwhile, Core CPI—which excludes volatile items—is projected to tick up to 2.5% year-over-year from 2.4% in the previous month.
Fed’s Collins keeps a hawkish tilt as inflation risks stay in focusFed’s Collins’ speech scores 7.1/10 on the FXS Speechtracker, modestly above the 6.7/10 historical average, signaling a slightly stronger hawkish tone relative to the historical average. Emphasis on an “elevated risk of high inflation,” expectations for inflation to remain above 2% amid high energy prices, and support for the September rate hike underscore a data-dependent but clearly inflation-focused stance, even as the job market is described as broadly balanced and resilient. References to ongoing growth, job market stability, and data-center build-out pressures on inflation reinforce a narrative of an economy robust enough to withstand tighter policy, which is typically supportive of the Dollar.
The FXS Fed Sentiment Index fell by 2.23 points to 131.63, indicating a modest pullback in perceived hawkishness despite remaining firmly above the neutral 100 threshold. This configuration suggests that while the overall Fed tone stays in hawkish territory, the incremental shift in sentiment is slightly less aggressive than prior readings, aligning with Collins’ data-dependent framing rather than signaling a clear pivot toward dovishness.
Central banks FAQs
Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.
A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.
A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.
Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report that GBP/USD has bounced firmly to 1.3255, invalidating their prior downside-bias call. Short-term momentum allows for further gains, but they doubt a clean break of major resistance at 1.3280 without stronger upside signals. Over the coming weeks, they expect Pound-Dollar to stay range-bound between 1.3170 and 1.3280, with another resistance level at 1.3310 if the upper band is breached.
Pound holds firm within defined range"24-HOUR VIEW: While we indicated yesterday that GBP “could trade with a downside bias,” we held the view that “any decline is likely part of a lower range of 1.3190/1.3235.” Our view was incorrect, and we also underestimated the volatility as GBP rose sharply from 1.3205 to 1.3259. GBP closed on a firm note at 1.3255 (+0.34%). The advance has scope to extend, but with no significant increase in upward momentum, GBP may not break the major resistance at 1.3280. To sustain the momentum, GBP must hold above 1.3230, with minor support at 1.3245."
"1-3 WEEKS VIEW: On Monday (12 Oct, spot at 1.3235), we highlighted that GBP “is expected to trade in a range between 1.3170 and 1.3280.” Although short-term upward momentum has improved somewhat, we will continue to hold the same view for now. Looking ahead, should GBP break above 1.3280, it would likely encounter another firm resistance at 1.3310."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Pound-Australian Dollar could extend gains if BoE Governor Andrew Bailey reinforces rate hike expectations, while softer Chinese trade may weigh on the Aussie. The Pound to Australian Dollar (GBP/AUD) exchange rate edged higher on Tuesday, as GBP investors welcomed an upward revision to UK growth expectations this year.
At the time of writing, GBP/AUD was trading at AU$1.8991. A modest increase from the start of Tuesday’s European session.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.324381 (+0.25%)
Australian Dollar to Dollar (AUD/USD): 0.697449 (+0.26%)
DAILY RECAP:
The Pound (GBP) ticked higher on Tuesday after the International Monetary Fund (IMF) upgraded its forecast for UK economic growth in 2026.
The IMF now expects the UK economy to grow by 1.3% this year, up from its previous projection of a 1% expansion.
However, while the IMF’s 2026 outlook improved, it warned that rising energy prices and elevated long-term borrowing costs are likely to weigh on economic activity in 2027, with growth expected to slow to 1.2%.
The upgraded growth forecast comes just a couple of weeks before Chancellor John Healey is scheduled to publish his first Autumn Budget.
The new forecasts have already helped to bring down UK gilt yields, which, coupled with the revised growth outlook, could offer more fiscal headroom for the Chancellor to balance Prime Minister Andy Burnham's growth ambitions, while also maintaining investor confidence in the UK's public finances.
The Australian Dollar (AUD) also attracted support on Tuesday after the minutes from the Reserve Bank of Australia’s (RBA) September meeting reinforced expectations that further interest rate hikes remain on the table.
The minutes revealed that policymakers were increasingly concerned about persistent inflationary pressures, with several of the upside risks identified at the previous meeting having since materialised or intensified.
This helped to offset the publication of Australia’s latest business confidence figures, after September’s NAB survey reported morale fell to a four-month low amid heightened cost concerns.
Near-Term GBP/AUD Forecast: Hawkish BoE Remarks to Strengthen Sterling? Looking ahead to the middle of the week, a speech by Bank of England (BoE) Governor Andrew Bailey may act as the primary catalyst of movement for the Pound to Australian Dollar exchange rate.
If Bailey reinforces recent signals from the BoE that the bank is ready to start hiking interest rates, it is likely to extend Sterling recent gains. Although any signs of caution could trigger a correction.
In the meantime, AUD investors may look to China’s latest trade figures for direction, with an expected slowdown in imports last month potentially reflecting negatively on the ‘Aussie’.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
Silver price (XAG/USD) is down 0.65% to near $58.70 during the European trading session on Wednesday. The white metal is under pressure as oil prices have increased recently amid ongoing tensions in the Middle East.
As of writing, the WTI Oil price trades 0.5% lower to near $93.44, but has recovered almost 7.5% from its recent low of $86.32.
Analysts at Commerzbank report that oil prices extended its recent advance, as "fresh Houthi attacks on Saudi infrastructure and continued tanker diversions from the Persian Gulf stoked supply fears." The bank highlights that the renewed disruption to Saudi facilities and shipping routes is reinforcing market concerns over the reliability of Middle East supply at current price levels.
Higher oil prices prompt global inflationary fears, a scenario that boosts the odds of hawkish interest rate decisions from central banks, which diminishes the appeal of non-yielding assets, such as Silver.
Meanwhile, investors keenly await the United States (US) Consumer Price Index (CPI) data for September, which will be published at 12:30 GMT. The data is expected to have a significant impact on Federal Reserve’s (Fed) interest rate expectations.
US inflation seen edging higher but Fed likely to stay patientAnalysts at Danske Bank expect a modest firming in the September data, forecasting “headline inflation at 0.5% m/m SA, 3.6% y/y (prior: 0.6% m/m, 3.4% y/y) and core inflation at 0.2% m/m SA, 2.5% y/y (prior: 0.3% m/m, 2.4% y/y), with energy prices being the main driver of the expected pickup in headline inflation.” For the policy outlook, Danske Bank emphasises that “for the Fed, focus will be on whether underlying inflation pressures are broadening.” With this being the final inflation release before the October FOMC meeting and “recent Fed communication signalling little urgency to hike again,” the bank judges that “it would take a clear upside surprise for the Fed to signal a rate hike already in October.”
Silver Technical Analysis
In the daily chart, XAG/USD trades at $58.75, extending its slide below the 20-day exponential moving average (EMA) at $61.45, which now acts as immediate overhead resistance and keeps the near-term tone bearish. The location of price under this key trend gauge suggests rallies are likely to be capped while the Relative Strength Index (14) at 37.49 stays on the weak side of neutral, hinting at lingering downside pressure rather than a decisive oversold rebound.
On the topside, the first level to watch is the 20-day EMA at $61.45, and a sustained break above this barrier would be needed to ease the current bearish bias and open scope for a broader recovery. On the downside, while no nearby structural price supports are evident in the dataset, the RSI reading at 37.49 indicates that sellers still have control but are approaching levels where dip-buying interest could start to emerge if the slide in XAG/USD extends further.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
United Overseas Bank’s Quek Ser Leang and Lee Sue Ann highlight a strong EUR/USD rebound to around 1.1200 after recent oversold weakness. In the near term, they see scope for the Euro to challenge resistance at 1.1220, while a sustained break would signal that the month-long downtrend has stabilised. However, they still flag deeply oversold conditions and acknowledge that further downside cannot be fully ruled out.
Euro recovery challenges 1.1220 barrier"24-HOUR VIEW: EUR fell sharply to a low of 1.1151 two days ago. Yesterday, we stated that “further EUR weakness is not ruled out, but given the oversold conditions, any decline should stay within a 1.1145/1.1185 range.” We were incorrect, as EUR rebounded strongly to a high of 1.1204. The advance has gained some momentum, and today, the rebound could potentially break above the strong resistance at 1.1220. We do not expect the major resistance at 1.1270 to come into view. However, it remains to be seen whether it can maintain a foothold above this level. Support is at 1.1185, followed by 1.1170."
"1-3 WEEKS VIEW: We highlighted yesterday that “the weakness in EUR that started more than a month ago has not quite stabilised, and EUR could decline gradually toward 1.1115.” We did not expect EUR to rebound strongly to a high of 1.1204. Downward momentum is fading rapidly with the strong rebound, and a break above 1.1220 (no change in ‘strong resistance’ level) would mean that the decline that started more than a month ago has stabilised."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Gold: CPI Holds the Key as Fed Keeps Another Hike in Play Gold’s view is focused on the U.S. inflation report due out on Wednesday. It will give us a clearer picture on the Fed’s next move. Do expectations suggest the CPI report will show a slowdown in inflation? Probably not. Energy costs are up, and traders are looking for headline CPI to come in at around 3.6% year-over-year. Fed Funds Futures are pointing to a roughly 22%-23% chance of a rate hike in October, and an 88% chance of rate hike by December hike.
New York Fed President John Williams, and Boston Fed President Susan Collins have echoed similar thoughts, and are also looking for a possible further rate hike this year. The Fed Funds rate is currently in the target range of 3.75%-4.00%. Higher rates are a headwind for non-yielding bullion.
Investment demand is also exceptionally strong, and global gold ETFs added another 67 tonnes in September, bringing total holdings to a record 4,256 tonnes. Record third quarter inflows of $31 billion have been reported.
Silver: Tight Supply Meets Softer Industrial Demand Gold and silver are expected to have similar price action, based on inflation and Fed risks. However, given the current fundamental supply and demand dynamics for the physical market, silver is in a tighter condition compared to gold.
The Silver Institute expects a sixth straight structural deficit in 2026. Estimates show the structural deficit would be 46.3 million ounces of silver, with a cumulative drawdown of 762 million ounces since 2021.
Given continued demand for silver in industrial applications, fabrication is expected to decline by 3% in 2026, to a four-year low. Solar manufacturers are expected to decrease the use of silver in fabrication, and substitute other materials.
However, demand is expected to rise for bars and coins by 18%, providing an offset for lower industrial demand.
Gold – Chart In the 2-hour chart, the current price of gold is at around $4,164. What is notable, at least for now, is price is still respecting the rising trendline from the recent lows at $4,066. In the short-term, the recovery is still valid. However, gold is still stuck below the overall bearish trendline as well as the $4,181 – $4,217 resistance zone. So, a full trend reversal has not occurred for gold bulls just yet.
Gold Price Forecast
Every new Gold analysis as it publishes, today's technical signal and key levels, live price — on one page.
See all Gold forecasts $4,181.44 is the first resistance level, followed by $4,216.96. Above that zone, resistance comes in at $4,253.15 and $4,296.57. Support is initially expected at $4,159.14, with $4,123.83 and $4,066.46 becoming progressively more relevant with a break of the rising trendline.
The RSI is around the 50 level, indicating a neutral bias. However, a slightly bullish bias is still valid as long as gold is trading above $4,159 and the rising trendline. As long as $4,159 and the rising trendline hold, the bullish case remains valid. Conversely, a break below $4,123.83 would invalidate the bullish case for now.
Silver Technical Analysis: XAG/USD Slips Below $59.83 as $58.68 Support Comes Back Into Focus
Silver – Chart Silver is currently trading at $59.27. I like to draw trends on the 2-hour chart, so I will focus on the short term trend for now. Price is currently trading below both of the moving averages as well as the trendline. I am also looking at the longer term trend where price is still trading below the descending trendline and has recently failed to reclaim the $59.83- $61.72 resistance.
I will watch $58.68 for support. If that breaks we will look to $57.64 and $56.55 for support. Resistance is $59.83 and $61.72. If we take a further long term trend view, $63.06 and $64.09 will come into play if they are retested.
RSI is still in the lower half of its range. While in the shorter term, the market has been trading sideways, I will maintain a bearish bias while price is trading below the $59.83 resistance and the descending trendline. I will take a bullish bias if price moves above $61.72. If price breaks $58.68, I will take a bearish bias and look for further support at $57.64.
Key Points:Markets price a 77% probability of the Fed holding rates steady in October, while September CPI is expected to reach 3.6%, keeping December tightening expectations in focus.DXY remains under pressure below its rising trendline, with a break beneath 101.93 potentially exposing 101.62 and 101.32, while 102.61 remains key resistance.EUR/USD tests descending trendline resistance at 1.1233, with a breakout potentially targeting 1.1275 and 1.1315, while 1.1157 remains critical support.GBP/USD breaks above its descending trendline and targets 1.3284, with a sustained breakout opening 1.3323 and 1.3368, while 1.3222 remains key support.Dollar Index: CPI Becomes the Test for Fed Patience In the lead up to U.S. inflation data for September, the fundamental outlook for the U.S. dollar softened as the market reassessed the need for further Fed tightening. According to the August reading, headline CPI rose 0.4% from the previous month and 3.4% on a year over year basis. For September, the median estimate of economists is for an annual increase of 3.6% from a year ago, with the month over month increase estimated at 0.6%. Market participants now place a 77% likelihood for the Fed to keep rates unchanged at the October meeting, up from 51% last month. New York Fed President John Williams is still looking for one additional hike this year, keeping December in play.
EUR: Lagarde Tells France Fiscal Solution Must Come From Paris The euro is still stuck between a restrictive ECB and a deteriorating French fiscal situation. ECB President Christine Lagarde has previously warned against proposals for the central bank to cancel French debt, dampening hopes that the central bank would step in to bolster French bonds.
The ECB has already hiked rates twice in the last four months, with a third hike possible in December. The IMF has warned that elevated borrowing costs underline the need for fiscal consolidation. Meanwhile, ECB policymakers are closely monitoring wage developments for indications of second-round effects of inflation.
GBP: BoE Tightening Case Strengthens, but Budget Risk Lingers While the fiscal policy backdrop in the UK still presents risk from the upcoming October 28 budget, the recent hawkish shift from the BoE has opened up a strong differential case from other central banks. With energy costs still high and squeezing profit margins, BoE Governor Andrew Bailey said firms are prioritizing cost cutting which may feed through to lower staffing levels and lower wage growth. Markets are expecting a 25 basis point hike from the BoE next month despite the bank keeping rates on hold since the start of the Iran conflict.
U.S. Dollar Index Technical Analysis: DXY Slips Below Rising Trendline as 101.93 Support Comes Into Focus
Dollar Index Price Chart – Source: Tradingview The US Dollar is currently hovering around 102.11 according to the 2 hr chart, and pulled back from 102.61. What I find interesting is that price is currently trading below the rising trend line, and currently testing the short term moving average zone. The larger trend is still bullish as the DXY is still trading above the longer term moving average, however the shorter term trend is now moving sideways.
101.93 is the first level of support that I am looking at. A breakdown below this level would target 101.62 and then 101.32. If the dollar bulls are still in control, the first target of resistance would be at 102.61, with 102.97 and 103.36 being the levels to watch if this is broken.
RSI is currently in the lower half of its range and is showing a slowing in the bullish trend. I am neutrally biased with a slight bearish bias as long as DXY is trading below the rising trend line. I would look for a close above 102.61 to validate a bullish move, and a close below 101.93 to validate a move toward 101.62.
GBP/USD Technical Analysis: Sterling Breaks Trendline as 1.3284 Becomes the Next Upside Test
GBP/USD Price Chart – Source: Tradingview The GBP/USD pair is currently trading at 1.3273 after rallying and breaking above the descending trendline that had been limiting the pair’s upside movements. Another thing worth considering is price’s move back above the short-term moving average, and the fact that the pair remains well above the 1.3222 support area. Altogether, the above-mentioned developments have considerably improved the short-term structure.
EUR/USD Price Forecast
Every new EUR/USD analysis as it publishes, today's technical signal and key levels, live price — on one page.
See all EUR/USD forecasts In the near-term, I see the 1.3284 level as the next resistance area, with a break above it targeting the 1.3323 and 1.3368 levels respectively. A move to the downside could see price test the 1.3222 support area again, with the 1.3180, 1.3147, and 1.3113 levels coming into play should the breakout fail to materialize.
RSI has also moved toward the overbought region, confirming the bullish bias, however, the strength of the move suggests a correction may be due. I am bullish while the pair trades above the 1.3222 support and the descending trendline. A clean break above 1.3284 strengthens the case for a move to 1.3323, and a break below 1.3222 negates the breakout.
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 at 1.1206 on the 2-hour chart and rebounding from 1.1157. With price pressing directly into the descending trendline and the short-term moving average, I consider the current area important. It could be the location of a breakout after a long-term decline.
The first resistance I’m looking at is at 1.1233. A break above that would have 1.1275 and 1.1315 in sight. If the area between 1.1178 and 1.1157 holds, the 1.1233 resistance would likely remain the next upside hurdle. Other areas that would offer support if the recovery fails are 1.1128 and 1.1092.
RSI is in bullish territory. With that along with the price holding above 1.1157, I’ll lean slightly bullish. I’m neutral to slightly bearish below 1.1157. A clean move above 1.1233 would shift things more bullish, while a move below 1.1157 would allow sellers to take control again.
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.
The Pound-Dollar rate could face renewed pressure if US inflation strengthens the Dollar, while further hawkish BoE signals may keep Sterling supported. The Pound US Dollar (GBP/USD) exchange rate trended higher on Tuesday, supported by a welcome upgrade to the UK's growth outlook for 2026.
Gold prices remained broadly unchanged in India on Wednesday, according to data compiled by FXStreet.
The price for Gold stood at 12,703.93 Indian Rupees (INR) per gram, broadly stable compared with the INR 12,702.09 it cost on Tuesday.
The price for Gold was broadly steady at INR 148,173.20 per tola from INR 148,154.70 per tola a day earlier.
Unit measure
Gold Price in INR
1 Gram
12,703.93
10 Grams
127,042.40
Tola
148,173.20
Troy Ounce
395,136.80
FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
(An automation tool was used in creating this post.)
The EUR/JPY cross trades in positive territory around 177.30 during the early European trading hours on Wednesday. The Japanese Yen (JPY) edges lower against the Euro (EUR) on a cautious Bank of Japan (BoJ) rate outlook. Traders will closely monitor the speech by European Central Bank (ECB) President Christine Lagarde later in the day.
Bloomberg reported that BoJ policymakers are leaning against a rare back-to-back interest rate increase this month while still eyeing the possibility of another move as soon as December. The source said the Japanese central bank will instead carefully examine economic data to see if another hike is warranted as early as the December gathering.
Pricing in the overnight swaps market showed that traders are pricing in nearly a 10% chance of a rate hike this month, with the probability rising to 88% for a move by December, according to Bloomberg.
Technical Analysis: EUR/JPY keeps a bearish vibe under the 100-day SMAIn the daily chart, EUR/JPY maintains a bearish near-term bias as spot holds decisively under the Bollinger middle band and the 100-day simple moving average (SMA). Price also stays below the Bollinger upper band, underscoring a capped tone, while the Relative Strength Index (14) at 36.41 remains subdued but above oversold territory, hinting at weak selling pressure rather than an exhausted downtrend.
On the topside, immediate resistance emerges at the Bollinger middle band / 20-period SMA near 178.45, en route to the 180.00 psychological level. A desicive break above this level could pave the way to the upper boundary of Bollinger band at 181.05 and the 100-day SMA at 183.05 as a stronger structural barrier.
On the downside, initial support level is located at the lower limit of Bollinger band around 175.90. The next contention level is located at the October 20 low, 2025 of 175.34, followed by the October 2, 2025 low of 172.27.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Japanese Yen FAQs The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
The US dollar rally is showing signs of exhaustion ahead of US CPI, despite expectations for a sharp rise in inflation. With EUR/USD oversold, bearish momentum fading and higher inflation potentially priced in, even a modest CPI disappointment could trigger a dollar pullback and provide the euro with some relief.
View related analysis:
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Swissy Attracts Safe-Haven Bets, AUD Shorts Surge to Record High | COT report
EUR/USD Eyes Rebound as US Dollar Rally Faces an Inflation Test
US inflation data drops in a few hours, and it could help set the tone for Kevin Warsh’s comments at his fireside chat on Friday. It is no secret that crude oil prices are likely to see inflation heat up, given they rallied as much as 60% from the July low to September high, and are now curling higher once more and heading towards $100.
Naturally, this has prompted consensus forecasts to rise to 0.6% in September, or 2.5% annualised. For perspective, that would be the third-highest monthly print in four years and the second-highest annual rate in three.
US Dollar Faces Pullback Risk as Inflation Expectations Look Priced In
But we know that energy prices are likely to be a major driver. Therefore, the two questions are how broad-based the inflationary pressures are, and whether higher inflation expectations have already been priced in?
We can see that Brent crude prices have accelerated, making them a useful leading indicator of energy-related inflation pressures. We’ve already heard the RBA express concern that inflation could become more broadly based than just energy, and if such evidence shows up in today's US figures, it will likely exacerbate those concerns for central banks in general. Moreover, it could revive hawkish Fed bets.
That said, I have a hunch we’re not going to see that just yet. Core inflation has been relatively contained, while shelter inflation continues to ease. And that leaves today’s CPI with the potential to dent the USD, despite consensus forecasts having risen.
US Dollar Rally Looks Stretched Ahead of CPI
The US dollar index has rallied just under 4% over the past five weeks, and price action suggests trend exhaustion could be kicking in around major resistance levels. With traders already expecting higher inflation, there’s a decent chance it is already priced in – and anything less than expected, even if only marginally, could prompt a pullback in the dollar.
US Dollar Index (DXY) weekly and daily charts showing resistance near 102, bearish RSI divergences and slowing bullish momentum ahead of US CPI.
Source: ICE, TradingView
EUR/USD and USD/CAD Implied Volatility Spikes Ahead of US CPI
Looking across FX majors shows that 1-day implied volatility has spiked for USD/CAD and EUR/USD. I outlined a near-term bearish case for USD/CAD in an earlier report, based on its extended rally, pause around resistance levels and bearish engulfing candle on Tuesday. Its 1-day IV is 84 pips, which is 167% of its 20-day average.
Yet EUR/USD has gone a step further with a 1-day IV of 90 pips, or 237% of its own 20-day average. Expected levels of volatility are also elevated on USD/CHF, GBP/USD, AUD/USD and NZD/USD, though only marginally above their own 20-day averages.
EUR/USD Technical Analysis: Euro vs US Dollar
If the US dollar rally appears stretched, there is a reasonable chance the EUR/USD rally could be oversold – given the euro accounts for nearly 60% of the DXY weighing. The weekly chart shows that its 4-week decline is losing bearish momentum with diminishing high-to-low ranges (bottom indicator). The weekly RSI (2) has been oversold for several weeks and now trying to curl higher, while a bullish divergence has formed on the daily RSI’s. Moreover, the 50-day detrended price oscillator (DPO – bottom indicator) is near levels previously associated with trend reversals. This is not an exact science as such indicator provide ‘indications’ and not signals as such. But put together, bears may at least want to tread with caution.
Also take note of Tuesday’s bullish engulfing candle. With a hunch that a hot CPI is priced in and high crude oil prices might not be showing up much beyond energy, my bias is for a bounce on EUR/USD while prices hold above the recent swing low.
Gold (XAU/USD) ticks higher during the Asian session on Wednesday, holding above $4,150 as traders now look forward to the latest US inflation figures before placing fresh directional bets. The US Consumer Price Index (CPI) is due for release later today, followed by the Producer Price Index (PPI) on Thursday. Apart from this, US Federal Reserve (Fed) Chair Kevin Warsh's speech at the annual meetings of the IMF and World Bank in Bangkok on Friday will be looked upon for more cues about the future policy path. The outlook, in turn, will play a key role in driving the US Dollar (USD) and provide some meaningful impetus to the non-yielding yellow metal.
In the meantime, the CME Group's FedWatch Tool indicates that traders are assigning a nearly 90% chance that the US central bank will raise borrowing costs again at its December policy meeting. The bets were lifted by the recent hawkish comments from influential FOMC members, signaling openness to additional interest rate hikes before the end of the year amid persistent price pressures. Moreover, worries about energy-driven inflation risks underpin prospects for further Fed tightening, which might continue to act as a headwind for gold. In fact, crude oil prices rose to a nearly two-week top amid supply concerns due to escalating conflicts in the Middle East.
Fighting between the Iran-allied Houthis and Saudi Arabia has intensified over the past week in retaliation for the kingdom's support of Yemeni government forces. Moreover, Houthi energy terminals and fuel reserves in Yemen were reportedly struck by a Saudi-led coalition. Meanwhile, tensions between the US and Iran also continued to simmer amid the standoff over the Strait of Hormuz. In fact, US Central Command rejected claims by the commander of Iran’s Islamic Revolutionary Guard Corps Navy that the strategic waterway is under Iran’s control and that any approaching US Navy warships would be sunk. This keeps the geopolitical risk premium firmly in play.
The USD, however, drifts lower for the second straight day, retreating further from its highest level since April 2025 and offering some support to gold. That said, the aforementioned bearish fundamental backdrop makes it prudent to wait for strong follow-through buying and a breakout through a short-term trading range held over the past two weeks or so before positioning for any meaningful upside for the XAU/USD pair.
XAU/USD 4-hour chart
Technical AnalysisBarring last week's knee-jerk fall to a two-month low, the range-bound price action might be categorized as a bearish consolidation phase against the backdrop of a decline from the August swing high. The Gold price, however, holds just above the 78.6% Fibonacci retracement at $4,115, suggesting a tentative floor. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator stays in negative territory with a slightly contracting bearish histogram that hints at fading downside pressure. The Relative Strength Index (RSI) around 50 points to neutral momentum, reinforcing the idea of consolidation within a broader corrective phase rather than a fresh bullish leg.
Hence, any subsequent move up might continue to face stiff resistance at the 100-period Simple Moving Average (SMA) on the 4-hour chart, at $4,193. This is followed by the top boundary of the trading range, near the $4,215-$4,220 region, and the 61.8% Fibo. retracement at $4,238, with further barriers seen at $4,325, corresponding to the 50.0% retracement level. Above these, the 38.2% retracement at $4,412 and the 23.6% retracement at $4,519 mark progressively stronger supply zones. On the downside, immediate support is seen at the 78.6% retracement at $4,115, ahead of the prior cycle low area at $3,957.83. A sustained break below $4,115 would likely open the door for a deeper slide toward that lower structural base.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
US Dollar Price Today The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
USDEURGBPJPYCADAUDNZDCHFUSD-0.11%-0.14%-0.08%-0.11%-0.18%-0.23%-0.09%EUR0.11%-0.03%0.05%0.00%-0.08%-0.16%0.00%GBP0.14%0.03%0.08%0.02%-0.05%-0.11%0.04%JPY0.08%-0.05%-0.08%-0.02%-0.11%-0.14%-0.00%CAD0.11%-0.00%-0.02%0.02%-0.08%-0.13%0.00%AUD0.18%0.08%0.05%0.11%0.08%-0.04%0.08%NZD0.23%0.16%0.11%0.14%0.13%0.04%0.15%CHF0.09%-0.00%-0.04%0.00%-0.01%-0.08%-0.15% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Silver price (XAG/USD) gains ground after two days of losses, trading around $59.20 per troy ounce during Asian hours on Wednesday. Non-yielding Silver gains following dovish remarks from New York Federal Reserve President John Williams. Speaking on Tuesday, Williams noted that while he maintains his view that one more rate hike may be appropriate this year, he does not foresee additional rate increases in 2027.
CME FedWatch Tool suggests that markets are currently pricing in roughly a 77% probability that the Fed will leave interest rates unchanged this month, while assigning an 88% chance of a rate hike in December.
Market focus now shifts to the US September CPI inflation data scheduled for release later in the North American session, which could offer clearer direction on the Federal Reserve's (Fed) monetary policy path. Headline US CPI is expected to show a year-over-year rise of 3.6% in September, up from 3.4% in August. Core CPI, which excludes volatile items, is projected to increase to 2.5% year-over-year from 2.4% in the previous month.
Geopolitical tensions remained a key focus as oil prices extended their gains amid escalating hostilities between Saudi Arabia and Iran-backed Houthi rebels, intensifying concerns over potential Middle East supply disruptions.
Energy complex stays resilient as tanker attacks escalateAccording to TD Securities, “strength across the energy market is hard to shake as tanker attacks escalate,” underscoring the firm’s view that ongoing security risks are helping to sustain robust pricing across the oil complex rather than allowing any meaningful easing in market tensions.
Adding to the cautious global sentiment, the International Monetary Fund (IMF) warned of significant risks to international economic growth and financial stability. The organization highlighted threats stemming from a potential slowdown in the AI investment boom, mounting debt levels, and a prolonged conflict in the Middle East.
AI and semiconductor demand stay resilient despite looming slowdownEconomists at DBS highlight that, despite a more challenging financing backdrop, there is still "limited evidence of a significant slowdown in AI investment or semiconductor demand." They point out that hyperscaler capital expenditure has "maintained robust yoy growth through 2Q," underscoring the strength of current AI-related spending. However, DBS also notes that this pace is unlikely to be sustained indefinitely, citing Bloomberg forecasts that growth is set to "moderate from 95% this year to 39% in 2027," suggesting a gradual normalization in the AI and semiconductor investment cycle over the medium term.
Technical Analysis:In the daily chart, XAG/USD trades at $59.20, extending a bearish near-term tone as it holds beneath both the nine- and 50-period Exponential Moving Averages (EMAs). The pair’s slide below these trend references suggests that rallies are likely to be capped by overhead supply, while the 14-day Relative Strength Index (RSI) at 38.87 stays below the midline, hinting at lingering downside pressure rather than a decisive oversold rebound.
On the topside, initial resistance emerges at the short-term nine-period EMA near $60.21, with a stronger barrier at the 50-period EMA around $62.99, where sellers may reassert control if prices attempt a recovery. With no clear nearby structural support indicated, the metal appears vulnerable to further weakness until buyers can reclaim at least the $60.21 level, which would be the first step toward easing the current bearish bias.
XAG/USD: Daily Chart(The technical analysis of this story was written with the help of an AI tool. Know more.)
Silver FAQs Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
The Euro (EUR) extends its Tuesday’s strong recovery move to near 1.1210 against the US Dollar (USD) during the Asian trade on Wednesday. The major currency pair attracts bids due to the correction in the US Dollar amid the pause in United States (US) Treasury Yields’ rally remaining intact ahead of the Consumer Price Index (CPI) data for September.
10-year US Treasury Yields have corrected to near 5.20% from its recent multi-decade high of 5.36%. The US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.1% lower to near 102.10. The DXY has retreated from its yearly high of 102.61 posted on Monday.
According to estimates, both headline and the core CPI grew at a faster pace of 3.6% and 2.5% Year-on-Year (YoY), respectively. Analysts at Societe Generale see the Federal Reserve’s (Fed) policy outlook remaining largely unchanged even if core CPI rises to 2.5% YoY.
Currently, the CME FedWatch tool shows traders are confident that the Fed will leave interest rates unchanged in the policy meeting later this month and will deliver a hike in December.
Meanwhile, French fiscal risks due to ballooning public debt and firm expectations that the European Central Bank (ECB) will keep interest rates unchanged this month will likely cap the upside in the Euro.
According to a Reuters poll conducted October 5-8, 70 of 73 economists expect the ECB to hold its deposit rate at 2.50% on October 29.
EUR/USD Technical Analysis
In the daily chart, EUR/USD trades at 1.1210, holding a bearish near-term bias as spot remains below the 20-period exponential moving average (EMA) at 1.1303.
The pair continues to be capped by this dynamic barrier, which reinforces the broader downside tone while the Relative Strength Index (RSI) at 32.15 hovers just above oversold territory, hinting that selling pressure is still dominant but not yet exhausted.
On the topside, initial resistance is located at the 20-period EMA around 1.1303, and a daily close above this level would be needed to ease the current bearish pressure and open the door to a deeper corrective bounce. On the downside, the October 12 low at 1.1153 is the immedaite support level; a decisive break below the same would expose the pair to 1.1100.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator
Consumer Price Index ex Food & Energy (YoY)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as the Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The CPI Ex Food & Energy excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures. Generally speaking, a high reading is bullish for the US Dollar (USD), while a low reading is seen as bearish.
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The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Gold price (XAU/USD) drifts lower to near $4,155 during the early Asian session on Wednesday. The precious metal extends the decline as rising oil prices fuel inflation concerns and prompt major central banks to tighten monetary policy. Traders await the US Consumer Price Index (CPI) inflation data later on Wednesday to gauge the outlook on monetary policy.
The International Monetary Fund (IMF) on Tuesday highlighted risks from elevated public debt levels and rising bond yields that may be driven higher still by war-driven inflation pressures.
Additionally, rising tensions in the Middle East raise fears of oil-driven inflation. Yemen’s Houthis launched a missile barrage at cities throughout Saudi Arabia as the military says projectiles are being intercepted, with shrapnel falling on the city of Dhahran and injuring at least four in the capital, Riyadh.
However, remarks from Federal Reserve (Fed) Bank of New York President John Williams might help limit the yellow metal’s losses. Williams said on Tuesday that he still sees one more interest-rate hike as appropriate this year, but doesn’t expect further tightening in 2027.
US Treasury yields dropped after Williams’ remarks, with two-year notes erasing an increase of as much as three basis points (bps). Lower yields are typically supportive for gold, which doesn’t bear interest.
Markets are pricing in roughly a 77.3% chance that the Fed will leave interest rates unchanged this month, while assigning nearly an 87.8% odds of a rate hike in December.
CTA short covering fails to remove downside risk for gold and platinumAccording to TD Securities, Commodity Trading Advisors have begun to pare back bearish exposure, with “CTAs covering some shorts in gold and platinum,” but the bank cautions that “pricing remains prone to further selling still.” This combination of short covering alongside lingering vulnerability underscores that recent positioning shifts have yet to fully neutralize downside risks in the precious metals complex.
Williams leans dovish on 2027 rates but Fed tone stays firmly hawkishFed’s Williams delivered a notably softer message, with the FXS Speechtracker score at 3.4/10, well below the 5.8/10 historical average, signaling a more dovish tone relative to the established baseline. The explicit comment that Williams currently sees no need for a rate hike in 2027, alongside confidence that inflation will slow “quite a bit” toward the 2% target next year, reinforces expectations for a prolonged pause and eventual easing in Dollar policy. This combination suggests reduced upside risks for the Dollar and a more supportive backdrop for risk assets, especially if incoming data confirm the disinflation narrative.
The FXS Fed Sentiment Index fell by 3.09 points to 133.86, indicating a meaningful pullback in perceived hawkishness despite remaining well above the neutral 100 mark. This configuration shows the Fed still in hawkish territory compared to the established baseline, but Williams’ softer stance and the weak FXS Speechtracker score point to a gradual shift toward a less aggressive policy outlook that FX markets may interpret as incrementally Dollar-negative over the medium term.
Technical Analysis: Gold remains capped under the 100-day SMAIn the daily chart, XAU/USD maintains a bearish near-term bias as price holds beneath the 100-day simple moving average (SMA) and the Bollinger middle band. The clustering of these overhead averages suggests gold remains capped within a corrective phase, while the lower Bollinger band underpins the current consolidation. The Relative Strength Index (14) at 43.15 stays below the neutral 50 line, hinting at subdued buying interest rather than an outright oversold condition.
On the topside, initial resistance is located at the Bollinger 20-period SMA near $4,220, followed by the 100-day SMA at $4,250, with a stronger barrier at the upper Bollinger band around $4,390, where selling pressure could re-emerge if a rebound extends. On the downside, immediate support is provided by the lower Bollinger band at $4,045; a decisive break below this floor would open the way toward deeper retracement, while holding above it keeps XAU/USD in a range-bound bearish correction beneath its key moving average cluster.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
US CPI is out today, Wednesday, October 14, and markets may be a bit quiet into the numbers. Gold, however, has already given us something important to think about.
The metal has come down and made a very important overlap below 4,200, and from an Elliott Wave point of view, I think this tells us a lot. When I look at the recovery from the June lows, this overlap suggests that the move may have been only a sharp three-wave rally with an extended wave C, not a five-wave impulse. And that's an important difference for me. A five-wave rally points to a new impulse and trend continuation, while a three-wave rally is typically corrective, which means the bears are still alive.
That said, I still see the price action as somewhat neutral, with gold trapped between the 4,050 and 4,700 areas. When I see a market overlapping like this in a wide band, I personally start to think about triangles, and here I'm considering a possible running triangle.
If that count is correct, gold could stabilize now around 4,100, where I see the 61.8% Fibonacci level for wave D. From there, a wave E recovery could develop. But when I put this 4-hour structure together with the higher time frame picture, it looks to me like the bigger wave four correction from the all-time highs is still ongoing, so any rally out of the current 4-hour downtrend channel could be limited around the 4,400-4,600 resistance.
On the bigger picture, gold has been trading in an impulsive fashion, but it's now in a wave four correction that could slowly come to an end later this year. The ideal strong support for that correction is the 3,900-3,200 zone.
What does this mean in practice? I would not chase gold lower here, but I'm also not in a rush to buy aggressively. Triangles are patient patterns; they take time, they frustrate both bulls and bears, and the best opportunities usually come when the pattern is close to completion.
The levels I'm watching:
4,200 – the overlap that turned the picture more correctiveAround 4,100 – the 61.8% Fibonacci area for possible wave D support4,400-4,600 – resistance for a wave E recovery4,050-4,700 – the broader range gold is still trading in3,900-3,200 – ideal strong support for the bigger wave fourWith CPI on the calendar, a sharp move in either direction wouldn't surprise me, but as long as gold stays within this range, I'll keep treating it as a sideways, corrective structure rather than a new trend.
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The Indian government is considering tighter regulation of “digital gold,” including requiring that all digital products be backed one-to-one with physical metal.
The fact that this isn’t already a requirement should give you pause.
With digital gold products, investors can buy and sell ownership of physical metal electronically. The digital gold provider stores physical gold in a vault on the owner's behalf. You technically own the gold, but you don't physically possess it. Digital gold allows quick transfers between accounts and facilitates fractional gold purchases. Some digital products allow investors to take physical possession of gold under certain circumstances. Others do not.
The downside is you don't have physical possession of the metal, and there's no guarantee the provider has all the gold either.
Last year, the Securities and Exchange Board of India (SEBI) warned that digital gold products fall into a regulatory crack since they are “neither notified as securities nor classified as commodity derivatives.”
“Such digital gold products may entail significant risks for investors and may expose investors to counterparty and operational risks."
And SEBI emphasized, “They operate entirely outside the purview of SEBI."
That may soon change with a regulatory structure run jointly by SEBI and the Reserve Bank of India.
A bank official who asked not to be named told the Times of India, “There is a consensus among all stakeholders that digital gold has gained acceptance among investors, and currently it is an unregulated segment which should be brought under the supervision of regulatory authorities.”
According to the Times, "The government is considering stricter regulations for digital gold, including a requirement that every unit be backed by physical bullion."
Stop and think about what that means. Currently, Indian law doesn't require digital gold providers to back their product with actual metal. That means they could run a fractional reserve system with only a small amount of gold on hand. That’s all well and good until everybody wants to take physical possession of their gold at the same time.
The situation isn’t much different in the U.S.
The United States has no uniform federal requirement that all digital gold products be backed ounce-for-ounce by physical bullion. However, individual products may provide that backing and operate under regulatory oversight, depending on the product's structure and jurisdiction.
Interestingly, digital gold platforms in India have already created a self-regulatory organization called the Digital Precious Metals Assurance Council of India. According to the Times, several of the largest platforms have joined.
MMTC-PAMP ranks as one of the largest digital gold companies in India and has joined the DPMAC. Managing Director Samit Guha conceded “the digital gold and silver ecosystem in India needs some regulatory oversight urgently.”
He said the council will help standardize processes for purchasing, selling, and storing gold.
This underscores that while digital gold products are convenient, they come with significant counterparty risk.
In simple terms, it is the possibility that the party on the other side of a transaction might not fulfill its obligation. Specifically, it means the digital gold custodian might not actually have all the gold it claims.
Government and private regulation can minimize counterparty risk to some degree, but it can’t eliminate it. As long as there is a party on the other side of a transaction, you’re taking on risk.
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The Chinese government has tried to internationalize the yuan and raise its stature as a global currency for decades. Hong Kong's ascension as a prominent yuan-denominated gold trading hub is giving that effort a big boost.
S&P Global Ratings managing director Charles Chang told CNBC that Hong Kong's evolution as a gold trading center and the ensuing elevation of the yuan's status could ultimately undercut the dollar.
“As those trading volumes grow, there would be a growing volume of the physical gold trade that is denominated in RMB and not linked in USD.”
Chang said the biggest challenge to internationalizing the yuan is finding places to use it. Hong Kong’s rapidly developing gold-trading platform coupled with Beijing’s aggressive gold buying creates such an avenue.
“In terms of gold particularly, if the RMB that the buyer receives can be converted to gold, then it gives more channels for the spending to be done.”
Hong Kong's quest to become a global gold hub
Earlier this summer, Hong Kong launched trial operations of a gold clearing and settlement system, putting the region in a position to challenge Western dominance of the global gold market.
The government-owned clearing system reportedly “mirrors” the financial infrastructure used by the LBMA in London.
When unveiling the system, Hong Kong Precious Metals Central Clearing Company CEO John Lee Ka-chiue said the company will offer “a comprehensive suite of services ranging from gold deposits and withdrawals to transaction settlements in the over-the-counter market in Hong Kong,” adding that a new gold price ticker – HAU – would be introduced to “ensure that Hong Kong gold prices are fully accessible to global market participants.”
To facilitate the clearing system, the Shanghai Gold Exchange (SGE) opened its first offshore gold delivery vault in Hong Kong.
At the time, Secretary for Financial Services & the Treasury Christopher Hui said that the SGE's decision to establish its first International Board certified vault in the special administrative region “offers international investors an option for delivering gold offshore, marking a key stride in the internationalization of the country's gold market, extending the global footprint of renminbi-denominated gold trading, and further strengthening Hong Kong's role in the regional market.”
Over the next three years, Hong Kong plans to expand its gold vaulting capacity from 150 to over 2,000 tonnes.
“If Hong Kong can complete this transaction, then it would become one of the largest gold trading centers in the world,” Chang said.
Last month, Hong Kong Exchanges and Clearing (HKEX) announced plans to launch a yuan-denominated gold futures contract early next year.
According to the South China Morning Post, the move aims to advance two priorities outlined in the city’s five-year plan announced last week:
Promoting yuan internationalizationDeveloping Hong Kong’s gold marketChinese central bank Gold buying also boosts YuanMeanwhile, the People’s Bank of China continues the aggressive expansion of its gold reserves.
The Chinese central bank has reported an increase in its official gold reserves for 23 straight months, including a 23-tonne addition to its official holdings in September. This followed 20-tonne purchases in July and August.
Year-to-date, the People’s Bank of China has reported 80 additional tonnes added to its gold holdings.
And the Chinese have bought a lot more gold than that. According to data parsed by the renowned Money Metals researcher, the Chinese central bank currently sits on more than 5,000 tonnes of monetary gold in Beijing – more than TWICE what Chinese officials publicly admit.
Guotai Junan International chief economist Hau Zhou said this consistent gold buying “reinforces the credibility of the renminbi’s internationalization drive.”
“By steadily increasing gold reserves, Beijing is strengthening the long-term backing of its financial system and reducing reliance on dollar-denominated reserve assets. While gold alone will not determine the RMB’s global role, it enhances confidence in the currency and supports broader efforts to expand its use in trade, investment and official reserves.”
Nanhua Futures head of precious metals and new energy research Xia Yingying said gold accumulation by China and other central banks will “reduce global reliance” on U.S. Treasuries and dollar reserves.
“In the medium to long term, it will gradually weaken the U.S. dollar’s monopolistic position in the global reserve system.”
A problem for the U.S.While the dollar won’t likely fall from its perch as a global reserve currency, even modest de-dollarization is problematic for the United States.
The U.S. depends on global demand for dollars.
The greenback’s role as the world's reserve currency is the only reason the U.S. can borrow, spend, and run massive budget deficits to the extent it does. It creates a built-in global demand for dollars and dollar-denominated assets. This absorbs the Federal Reserve’s money creation and helps maintain dollar strength despite the Federal Reserve’s inflationary policies.
A de-dollarization of the world economy could cause a dollar glut. The U.S. currency could further depreciate. At the extreme, global de-dollarization could spark a currency crisis. You and I would feel the impact through higher price inflation, eating away at the dollar's purchasing power. In the worst-case scenario, it could lead to hyperinflation.
AUD/USD coils beneath 0.7000 ahead of US CPI
Five-session correlation with US two-year yields reaches +0.81
Just 6.1bp of tightening priced for October Fed meeting
Historical CPI-day bullish bias fades in post-pandemic inflation environment
AUD/USD is coiling in a compressed structure ahead of tonight's US CPI report, with the underlying details providing a clear catalyst for a potential breakout.
The Aussie's strengthening relationship with US front-end yields over the past week underlines the importance of tonight's inflation report, not only for the currency but also for broader commodity markets, which have been moving closely in line with AUD/USD.
US inflation and Fed pricing in focus
Core US CPI is expected to increase 0.2% in September, down from 0.3% in August, a relatively subdued outcome given the inflationary pressures we've seen building elsewhere, particularly in energy and producer prices.
As the graphic below shows, the recent moderation in core consumer inflation contrasts with far stronger price pressures further upstream, raising questions over just how long this trend can last before hitting the consumer level.
Source: LSEG, FRED
For traders, the question around the latest CPI report is whether it will be hot enough to meaningfully revive expectations for a rate hike from the Fed later this month, or sufficiently soft to spark a further unwind in hawkish pricing looking out to the end of next year, which has been declining over recent weeks.
Only 6.1 basis points of tightening is priced for the October meeting, while cumulative hikes through the December meeting next year stand at around 82 basis points, down from more than 100 basis points.
Source: TradingView
Given the influence front-end pricing has had on the broader US dollar recently, how these expectations shift could go a long way towards determining how the dollar behaves later Wednesday.
What's driving the Aussie ahead of CPI?
Looking at the relationship between daily movements in AUD/USD and other major markets, there's been a noticeable shift in what the Aussie has been responding to recently.
Source: LSEG
Over the past five sessions, the correlation between AUD/USD and US two-year Treasury yields has strengthened to +0.81, compared with +0.43 over 10 sessions and -0.35 over 20 sessions.
While five sessions is a small sample, the strengthening relationship heading into CPI is noticeable, suggesting the earlier disconnect may have been driven by temporary factors, including quarter end.
The graphic also shows the Aussie has maintained a consistently strong inverse relationship with daily movements in the US Dollar Index, while moving closely with daily gyrations in precious metals and, to a lesser degree, industrial metals, indicating its standing as a high-beta commodity currency remains firmly in place.
History offers little directional guidance on CPI days
In the interest of completeness, I also decided to look at how the Aussie has performed on US CPI days in the past. And it's obvious from the results that there's been no firm directional steer in recent years.
That wasn't always the case, mind you, with the Aussie rising on nearly 69% of CPI release days between 2016 and 2019, an era of subdued inflationary pressures that may have benefited risk appetite.
But that bullish skew has weakened considerably in the more inflationary environment since the pandemic, with the positive hit rate falling to around 56% since 2023.
With outcomes increasingly resembling a coin toss, traders should be prepared to assess opportunities in both directions depending on how tonight's report prints.
A breakout approaching?
Source: TradingView
On the four-hourly timeframe, AUD/USD has been trading in a contracting range since bottoming in early October, with a series of higher lows meeting resistance just beneath 0.7000.
While the structure has characteristics of both a symmetrical and ascending triangle, what's clear is that there's something akin to a resistance zone immediately overhead. The price is now testing a shallow downtrend dating back to late September, although a previous break above this level failed at 0.6996, where rallies also stalled on several occasions in late September.
That makes the area between the downtrend resistance and 0.7004, the low set on September 25, the zone to watch immediately overhead. A sustained break above the top could open the door to 0.7040, a level that has acted as both support and resistance in the past and where the 100 and 200-day moving averages are on the cusp of intersecting.
Above that, 0.7057 and 0.7067 are the next levels of note.
If the Aussie were to reverse lower yet again, 0.6950 and 0.6938 are the initial levels to watch, followed by a support zone between 0.6907 and 0.69042, where earlier breakdown attempts stalled.
As for momentum, RSI (14) has moved back above the neutral 50 level, although at around 57 it hardly suggests upside pressure is building rapidly. MACD has confirmed the signal by staging a bullish crossover, reinforcing the modest improvement in upside momentum.
Combined, the oscillators marginally favour long strategies over short, although the message is far from definitive, particularly ahead of tonight's inflation report, which screens as a binary risk event.
GBP/USD Bounce in Focus as USD/CAD and GBP/CAD Offer Clues
Markets are eagerly awaiting September’s US inflation figures later today. Naturally, inflation is expected to heat up given the rise in crude oil prices amid renewed tensions in the Middle East. But with the US dollar already rallying to recent cycle highs on hawkish Fed bets, CPI may need to exceed elevated expectations to justify further gains.
This generally creates a ‘for or against the USD’ environment for FX majors, as correlations strengthen and price action becomes increasingly driven by the US dollar. But among the FX majors, GBP/USD has caught my eye for a potential bounce, given the price action clues from USD/CAD and GBP/CAD.
View related analysis:
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USD/CAD Technical Analysis: US Dollar vs Canadian Dollar
The daily chart shows a strong rally from the September low to last week’s high, delivered in a remarkably straight line. Yet with no meaningful pullback so far, and signs of a shakeout emerging ahead of US inflation data, USD/CAD may finally be primed for a retracement.
USD/CAD has traded within a volatile, sideways range of around 100 pips, with Tuesday’s bearish engulfing candle being the most volatile of the range. Combined with bearish divergences on the daily RSI (2) and RSI (14), both in overbought territory, it might not take much of a CPI miss for bears to retain control.
Note that the 2025 high, weekly S2 pivot and 20-day EMA converge around 1.4500, making this a potential downside target for bears during the anticipated retracement.
USD/CAD Outlook: Bears Eye Break Below Range Support
However, the 4-hour chart shows the weekly S1 pivot providing support near the range lows for now. And with US CPI looming, the dollar could attract a last-minute bid ahead of the release, allowing for some bullish mean reversion within the range.
But while prices remain within the range and below its high, the near-term bias favours a downside break towards the 1.4150 support cluster.
Source: ICE, TradingView
GBP/CAD Technical Analysis: British Pound vs Canadian Dollar
Granted, price action is a little messy on the daily chart – but GBP/CAD retains a bullish structure overall. The weekly chart shows the uptrend recently found support around the 50-week EMA with a spike low, while momentum has since broken higher from a bearish corrective channel.
That said, a rickshaw doji formed last week, and prices are now retracing against the bullish range expansion candle. Though with several support levels nearby, I am seeking evidence of a swing low on the daily chart.
GBP/CAD has formed a two-day pullback within Friday’s bullish range, while holding above the 10- and 20-day EMAs for now. The monthly pivot point sits just above 1.8800, so I’m waiting for bullish momentum to return, potentially paving the way for a move towards monthly R1 at 1.8966 or the 1.9000 handle.
Source: ICE, TradingView
GBP/USD Technical Analysis: British Pound vs US Dollar
Interestingly, if my assumptions of a pullback in USD/CAD and a rebound in GBP/CAD prove correct, it should bode well for GBP/USD. And the fact that Cable has now produced two rickshaw dojis on the weekly chart near the bottom of its range, around the 1.3200 handle, also supports my hunch for a bounce.
The daily chart shows a volatile shakeout over the past 13 days. Much like a dog violently shaking a toy to wrestle it from someone's hand, markets can behave in a similar way before finally breaking free. Given we're seeing a volatile shakeout near range lows while support levels continue to hold, my assumption is that GBP/USD could be preparing for a bounce.
Tuesday's bullish engulfing candle could provide the trigger, particularly if today's US CPI report allows the dollar to pull back from its recent rally.
Gold remains under pressure below moving-average resistance, with $4,066 support at risk, while a breakout above $4,226 could confirm a falling wedge reversal.
Sellers Maintain Control Below Moving-Average Resistance Gold began the week with a slight advance to test resistance near the 20-day moving average, now around $4,219, before sellers took back control and drove prices lower. That resulted in a loss for the day and a weak close in the lower half of the day’s range. Sellers remained in control on Tuesday, with a lower daily high of $4,200 and a lower daily low of $4,150. At the time of writing, trading remains near the low of the day and could extend lower. A close in the lower third of the day’s range appears likely, which would reinforce the short-term bearish indications.
Spot gold daily chart shows resistance near falling 20-day moving average Consolidation at a Critical Crossroads Monday’s advance also failed to recover the recent minor lower swing high of $4,226, which marks a key level in the declining trend structure and the top of an 11-day consolidation range. That range could eventually form a base for a renewed advance. Alternatively, a break below the corrective low of $4,066 would signal a continuation of the bearish trend. The 20-day moving average’s decline toward the lower portion of the consolidation range highlights the risk of further downside. If a break below $4,066 occurs then the 88.6% Fibonacci retracement of the prior advance at $4,028 becomes a target, followed by the June low of $3,942.
Spot gold daily chart shows larger trend structure $4,226 Marks the Bullish Reversal Threshold So far, this week’s price action has preserved the bearish trend structure. However, since the 20-day moving average has now fallen below the top of the range at $4,226, a bullish reversal signal above that high will also confirm a reclaim of the 20-day moving average. That average is a key dynamic resistance indicator for the short-term trend, especially since it has acted as resistance several times during short-term rallies in the decline from the August peak of $4,697, which began the current decline.
Falling Wedge Offers an Alternative Path Higher Alternatively, the bearish correction from the August peak of $4,697 formed a falling bullish wedge pattern. Monday’s advance was an initial upside breakout attempt that has failed so far. A move above $4,226, however, would strengthen the bullish case by signaling a wedge breakout, confirming a bullish reversal, and reclaiming the 20-day moving average. Initial upside targets in this bullish scenario would be $4,400, $4,511, and $4,697. These upside levels would become relevant if buyers overcome the resistance that has contained recent rallies, potentially marking a transition from the current bearish structure to a renewed advance.
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The GBP/JPY extends its modest gains for two straight days, up 0.16% as the cross-pair continues to consolidate near the 210.00 figure with no clear bias, while the Relative Strength Index (RSI) drifts higher towards its 50-neutral level, an indication that buyers are stepping in.
GBP/JPY Price Forecast: Technical outlookAs of writing, a downslope resistance trendline near 209.80-210.00 is being tested by buyers, who were quickly rejected on Monday after hitting a weekly high of 209.99.
Worth noting that the day’s price action shows that buying pressure is building after GBP/JPY reached a low of the day (LOD) below 209.00, respecting a support trendline tested three times, an indication that further upside is seen.
A decisive breakout above 210.00. puts into play the September 18 cycle high of 211.28. Further gains are seen beyond that area, with the 50-day SMA seen as a key supply zone at 211.84.
Conversely, for a bearish continuation, GBP/JPY must drop below 209.00 and clear the support trendline, which caps losses, with the next support at 206.89, the September 30 low.
GBP/JPY Price Forecast: Technical outlook
GBP/JPY daily chart 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 US Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.38%-0.34%-0.17%-0.45%-0.34%-0.46%-0.26%EUR0.38%0.03%0.21%-0.05%0.03%-0.07%0.13%GBP0.34%-0.03%0.15%-0.13%-0.01%-0.14%0.10%JPY0.17%-0.21%-0.15%-0.27%-0.16%-0.28%-0.06%CAD0.45%0.05%0.13%0.27%0.11%-0.01%0.21%AUD0.34%-0.03%0.01%0.16%-0.11%-0.12%0.09%NZD0.46%0.07%0.14%0.28%0.00%0.12%0.23%CHF0.26%-0.13%-0.10%0.06%-0.21%-0.09%-0.23% 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).
US Dollar Talking Points:
The US Dollar remains near fresh yearly highs and EUR/USD near lows as both markets have shown an extreme stretch over the past few weeks.
Meanwhile GBP/USD holds within what’s been a consistent range, and USD/JPY retains clean bullish structure.
The US Dollar rally remains in force but the past few weeks have seen a slowing in the move, illustrated by upper wicks on the weekly chart. Along with that, we’ve seen odds for an October rate hike soften even despite some pointed and hawkish comments over the past couple days from Beth Hammack of the Cleveland Fed and Austan Goolsbee of the Chicago Fed.
For structure, there’s support at the Fibonacci level of 101.80 and if sellers can make a push below that, it’ll start to look like the currency is more ripe for a pullback, which can be extrapolated elsewhere, such as EUR/USD and GBP/USD.
US Dollar Weekly Chart
Chart prepared by James Stanley; data derived from Tradingview
EUR/USD
The Euro is 57.6% of the DXY quote and as discussed in the webinar, the long-term prospects of the single currency remain in question given the large differences in the Eurozone economic backdrop. Flying French yields have brought that question back to the forefront and it makes the Euro as a less attractive medium for reserves, and I think that’s played a role, albeit minor at this point.
But – the sell-off has started to slow and CPI tomorrow can give this a push. At this point it looks like the EUR/USD pair wants to test a cross back from oversold territory on daily RSI, and as shown in the webinar, there’s a falling wedge formation shorter-term which points to the possibility of bullish reversal.
EUR/USD Daily Chart
Chart prepared by James Stanley; data derived from Tradingview
GBP/USD
If looking for USD-weakness, GBP/USD makes a stronger case, at this point. The pair has been lodged at range support for three weeks now, around the 1.3200 handle. And from the weekly chart, we can see a range that’s been in-place for pretty much all of 2026, so far.
GBP/USD Weekly Chart
Chart prepared by James Stanley; data derived from Tradingview
USD/JPY
For USD-strength, USD/JPY makes for a more compelling case and if we’re in the scenario that presents stronger rate hike expectations with higher-than-expected inflation, that can support upside in the pair.
The primary issue is a theoretical cap to upside after the rather heavy-handed interventions, but that opens up a new realm of scenarios in breakout situations, particularly if the 160.00 level can come back into play. For now, there’s a similar build of price action that showed in August, when a series of higher-lows ran into that big figure, ultimately culminating in a strong sell-off brought upon by intervention threats.
Where this comes in for CPI tomorrow, is if we do get some element of pullback, support remains attractive for higher-low potential. There’s levels at 158.06 and 157.54, followed by the same 156.68 that’s been in-play multiple times already.
USD/JPY Daily Price Chart
Chart prepared by James Stanley; data derived from Tradingview
USD/CAD
Similarly, the rally in USD/CAD has slowed over the past couple weeks. Sellers haven’t taken that next major step, until today, at least, and this highlights a significant level at the 1.4200 handle. A push below that and the weekly chart will start looking like an evening star formation, which opens the door for a push back towards the 1.4000 handle. The question is whether USD-weakness would be more attractive here than EUR/USD or GBP/USD above, and I don’t expect that to be the case at this point given what the chart is showing.
USD/CAD Weekly Chart
Chart prepared by James Stanley; data derived from Tradingview
--- written by James Stanley, Senior Market Analyst, Global Macro
Scotiabank strategists Shaun Osborne and Eric Theoret say the Euro (EUR) is marginally firmer versus the US Dollar (USD) on the softer USD tone, with ECB Governor Stournaras signalling continued gradual tightening. They judge EUR/USD retains a soft undertone and may be overshooting, as front-end spreads and risk reversals adjust, while their fair value model points to equilibrium around 1.1250, above current spot.
Euro edges up as ECB stays gradual"The EUR is marginally higher on the day, reflecting the generally softer tone of the USD. ECB Governor Stournaras remarked that the central bank will likely stick with its policy of gradual monetary policy tightening."
"Final German September CPI was confirmed at 3.3% in the year. The EUR retains a soft undertone but spot pricing may be overshooting somewhat."
"Front-end spreads have narrowed a little from the early October levels and short-term risk reversal pricing has pared the premium for EUR puts somewhat. Our fair value model suggests spot equilibrium sits around 1.1250 currently."
"EUR/USD short-term technicals: Neutral/bearish – Bearish pressure on the EUR may be moderating but there is little indication from short-term price action that a rebound is developing."
"Intraday price signals suggest a minor low may be developing around the mid-1.11 area. But short-term trend resistance remains intact at 1.1215 and a push above this area is the bare minimum the EUR needs to achieve to strengthen in the short run."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Japanese Yen Technical Forecast: USD/JPY Short-term Trade Levels
USD/JPY has rebounded more than 4% from the September low and is attempting to extend a fifth consecutive weekly advance.
Buyers need a sustained push through the 200-day moving average to strengthen the continuation case and expose higher resistance.
A break below the weekly range floor would shift the focus back toward major support at the yearly open.
U.S. CPI and PPI headline the event risk ahead, with hotter inflation potentially reviving Fed tightening expectations and supporting USD/JPY.
Resistance 158.56/73, 159.75, 160.37/74 (key) - Support 157.70/90, 156.67/69 (key), 155.03/23
USD/JPY is holding above a key technical pivot as the recovery from the September low remains intact, but the advance has lost momentum beneath major resistance. The weekly range has tightened considerably, leaving price compressed between support and the 200-day moving average as traders await the next directional break. With U.S. CPI and PPI on deck, the coming sessions could provide the catalyst needed to resolve the range and shape the next leg of the trend. Battle lines drawn on the USD/JPY short-term technical charts.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Yen setup and more. Join live on Monday’s at 8:30am EST.
Japanese Yen Price Chart – USD/JPY Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/JPY on TradingView
Technical Outlook: In last month’s Japanese Yen Short-term Technical Outlook we noted that USD/JPY was, “approaching a major technical hurdle near the yearly lows. While the outlook remains tilted to the downside, the bears may be vulnerable near-term heading into the lower bounds of the proposed downtrend. From a trading standpoint, rallies should be limited to 156.67 IF price is heading lower on this stretch..” USD/JPY reversed the following day with a rally of more than 4% attempting to mark a fifth consecutive weekly advance. The rebound takes price back into the 200-day moving average with the weekly opening range now set just above a well-defined technical pivot zone. The focus is on a breakout in the days ahead for near-term directional guidance.
Japanese Yen Price Chart – USD/JPY 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/JPY on TradingView
Notes: A closer look at Japanese Yen price action shows USD/JPY straddling a key pivot zone of r the past-four weeks at 157.70/90. This region is defined by the 2025 high-day close (HDC) and the November high and now defines the weekly range low. Note that a three-point confirmed trendline extending off the October lows also converges on this zone.
Initial resistance is eyed at the 200-day moving average and the September high-day reversal close at 158.56/73. A topside breach / close above this threshold would be needed to fuel the next leg of this advance towards subsequent resistance objectives at the 61.8% retracement of the July decline at 159.75 and 160.37/74- a region defined by the April high-close (HC), the September high, and the 2024 high-week close (HWC). Look for a larger reaction there IF reached.
A break below the weekly range lows would threaten a larger pullback towards the 2026 yearly open and the 38.2% retracement of the September rally at 156.67/69. A break / daily close below this threshold would be needed to suggest a more significant high is in place and a larger reversal is underway. The next major technical consideration is eyed at the May & August lows and the 61.8% retracement at 155.03/23.
Bottom line: USD/JPY is attempting to stabilize above a key pivot zone with the weekly opening range taking shape just below the September high day close. From a trading standpoint, the immediate focus is on a breakout of the 157.70-158.73 range for guidance with the bulls vulnerable while below the 200-day moving average.
The economic calendar picks up over the next few days with the release of September U.S. inflation data, including the Consumer Price Index (CPI) and Producer Price Index (PPI). With expectations for an October Fed rate hike having diminished considerably, a hotter-than-expected inflation reading could revive the prospect of earlier tightening, supporting Treasury yields and the U.S. dollar. A downside surprise, however, could further push back expectations for the Fed’s next move, eroding support for the greenback and opening the door for another leg lower in USD/JPY. Keep in mind that the threat of official Japanese intervention continues to loom over the trade, with authorities retaining the option to step in should yen weakness accelerate. Stay nimble into the releases and watch the weekly close for guidance. Review my latest Japanese Yen Weekly Forecast for a closer look at the longer-term USD/JPY technical trade levels.
Key Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
Active Short-term Technical Charts
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
Canadian Dollar Short-term Outlook: USD/CAD Six-Day Rally Challenges Pivotal Resistance
Gold Price Short-term Outlook: XAU/USD Bulls Fight to Stabilize at Pivotal Support
--- Written by Michael Boutros, Senior Technical Strategist
Gold 131026 Daily Chart
Gold is losing ground despite weaker dollar. U.S. dollar pulled back against a broad basket of currencies as forex traders took some profits off the table near yearly highs. Weaker dollar is bullish for dollar-denominated commodities, including gold.
Treasury yields were mixed in today’s trading session. The yield of 2-year Treasuries moved above the 4.81% level as traders bet that Fed will be forced to raise rates to fight inflation. That said, FedWatch Tool indicates that there is a 23.8% probability of a rate hike at the next meeting in October. The market expects that Fed will raise rates in December.
Interestingly, longer-dated bonds have finally started to attract investors. The yield of 10-year Treasuries pulled back towards the 5.22% level, while the yield of 30-year Treasuries declined below 5.58%. Gold traders focused on dynamics of shorter-term yields and ignored recent developments in long-dated bond markets.
Oil prices gained some ground as traders focused on escalation in the Middle East. President Trump said that Houthis were “behaving very badly” and accused them of trying to drive up oil prices. I’d note that oil markets did not rally after Trump’s words, which was surprising as Trump’s post signaled that U.S. could put pressure on the Houthis.
From the technical point of view, gold made an attempt to settle above the resistance level at $4160 – $4180 but lost momentum and pulled back towards the $4150 level. In case gold settles below $4160, it will head towards the $4100 level. A move below $4100 will open the way to the test of the support at $4000 – $4020.
Silver Retreats As Gold/Silver Ratio Moves Above 70
Silver 131026 Daily Chart
Silver pulled back as gold/silver ratio climbed above the psychologically important 70.00 level. If gold/silver ratio settles above 70.00, it will head towards the 72.00 level, which will be bearish for silver.
Currently, silver is trying to settle below the $59.00 level. In case this attempt is successful, silver will move towards the nearest support, which is located in the $56.00 – $57.00 range.
A move below the $56.00 level will provide silver with a chance to gain additional downside momentum. In this case, silver will head towards the $52.00 level. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
Gold Price Forecast
Every new Gold analysis as it publishes, today's technical signal and key levels, live price — on one page.
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Platinum Is Under Strong Pressure
Platinum 131026 Daily Chart
Platinum is losing ground amid broad pullback in precious metals markets. Palladium markets are down by -1.3%, which is bearish for platinum.
Platinum failed to settle above the resistance at $1700 – $1720 and declined towards the $1650 level. In case platinum settles below $1650, it will head towards the nearest support, which is located in the $1600 – $1620 range. A successful test of this level will open the way to the test of the $1520 level.
If you’d like to know more about how to trade gold and silver, please visit our educational area.
Silver (XAG/USD) trades on the back foot on Tuesday, losing more than 1.5% as hawkish Federal Reserve (Fed) expectations and elevated US Treasury yields weigh on the non-yielding metal. However, a softer US Dollar (USD) helps contain losses ahead of Wednesday’s US Consumer Price Index (CPI) report. At the time of writing, XAG/USD trades around $59.25, near two-month lows.
The US Dollar Index (DXY), which tracks the Greenback against six major currencies, trades around 102.25, below Monday’s peak of 102.61, its highest since April 2025. A hotter-than-expected inflation reading could lift the US Dollar and Treasury yields and revive expectations of a rate hike at the Fed’s October 27-28 meeting, adding pressure on Silver.
Traders currently price in an 80% probability that rates will remain unchanged this month, according to the CME FedWatch Tool. In contrast, softer inflation could strengthen the case for a pause and offer the metal some relief, although elevated Oil prices keep inflation risks tilted to the upside and expectations of further Fed tightening alive. Higher borrowing costs increase the opportunity cost of holding non-yielding assets such as Silver.
Technical analysis
On the daily chart, XAG/USD remains under the Bollinger Bands Simple Moving Average (SMA) midline at $62.29, keeping the near-term tone bearish. Momentum backs this softer bias, with the Relative Strength Index (RSI) drifting toward the mid-30s and the Moving Average Convergence Divergence (MACD) histogram still negative, while the Average Directional Index near 19 suggests the downtrend is present but not strongly directional.
On the downside, immediate support sits at the Bollinger lower band near $57.42, ahead of the horizontal level at $55.50 and a deeper floor at $50.00. On the topside, initial resistance emerges at the Bollinger SMA midline around $62.29, followed by the upper band near $67.16, with more significant barriers at $70.00 and $75.00 that would need to be reclaimed to ease the current bearish pressure.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Silver FAQs Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
The trading week continues to unfold and, for now, USD/CAD remains trapped in a relatively consistent phase of indecision. The Canadian dollar has managed to hold on to some of its recent strength, which can be seen in the pair's performance over the last two sessions, where it has declined by roughly 0.2%.
Pound Sterling-Dollar Forecast: UK Policy Clarity Holds Key to Recovery
BofA expects a medium-term Pound Sterling recovery, but UK policy uncertainty and the US Dollar's appeal during a narrow US equity rally complicate the path.
Bank of America's forecast for the Pound to reach $1.45 by the end of 2027 depends on a recovery that has yet to emerge convincingly from recent trading.
GBP/USD was near $1.3250 at the time of writing, up 0.30% on Tuesday, following a 2.10% fall during September.
Latest-Exchange Rates:
Pound to Dollar (GBP/USD): 1.324505 (+0.26%)
Euro to Dollar (EUR/USD): 1.119239 (+0.29%)
Dollar to Yen (USD/JPY): 158.36742 (-0.10%)
BofA's latest Global FX Weekly retains a $1.37 projection for end-2026, alongside the longer-term $1.45 forecast, which stands roughly 9.4% above the latest rate.
Strategists Michalis Rousakis and Claudio Piron write: "Elsewhere, we maintain a constructive medium-term view on GBP but prefer to await greater clarity on UK policies."
Image: GBP/USD 48hr chart
UK resilience helps, but the policy test remains
Its quantitative FX team writes: "UK data have recently surprised consistently to the upside, while growth expectations have been revised materially higher."
Those observations support Sterling's relative appeal, particularly against a Euro weakened by French fiscal concerns, but they do not remove the uncertainty around Britain's own Budget on 28 October.
Higher government borrowing costs can reflect concern about fiscal credibility as well as expectations of monetary tightening.
In his 8 October speech on financial resilience, Bank of England Governor Andrew Bailey warned that doubts about government finances can drive yields higher and tighten financial conditions.
See our analysis of the Budget's spending-credibility test which explores that risk alongside the protection offered by resilient activity.
BofA nevertheless expects the BoE to respond to the inflation threat.
Its central-bank assessment states: "We changed our BoE call- we now expect the BoE to hike twice in Nov '26 and Feb '27 to 4.25% to guard against risks of second round effects, assuming high energy prices persist into early next year and barring big downside surprises in data."
The BoE held Bank Rate at 3.75% in September, with three of its nine policymakers preferring an increase.
The Dollar has support beyond interest rates
A tighter UK stance would not automatically improve Sterling's yield advantage if US policy also became more restrictive.
BofA's Federal Reserve call remains hawkish, although it acknowledges uncertainty about the number of increases still to come: "We maintain our call for a hike at both the Oct and Dec meeting, though we acknowledge the risks is that we may only get one more hike this year".
The bank also sees investment in US technology companies as an important source of Dollar demand.
Adarsh Sinha and Claudio Piron explain why the composition of the stock-market rally matters: "Intuitively, such breadth measures tell us about the US vs. rest of the world prospects, which are key for the USD exchange rate. A broad rally typically reflects a global growth upswing, with cyclical sectors outperforming and growth differentials versus the US narrowing. In contrast, a technology-led rally reinforces the US exceptionalism narrative, attracting capital inflows and supporting the USD."
For GBP/USD, this means a stronger UK economy can coexist with a firm Dollar if international investors continue concentrating their money in US assets.
Rousakis and Piron write: "However, risks continue to accumulate for already nervous markets, including the ongoing Iran war and associated supply shock, rising concerns about the existential risks posed by AI, the apparent intractability of fiscal challenges, renewed trade tensions and, of course, the upcoming US midterms."
BofA therefore distinguishes a broadening equity rally from a general retreat in share prices.
Sinha and Piron write: "Looking ahead, what would a transition away from a narrow rally regime imply? A broadening would be USD negative from both the equity level & breadth effects, most clearly against high beta FX. An equity correction would be more nuanced: the level effect would be USD positive (except vs. JPY) but dampened if the sell-off is concentrated in large cap technology stocks."
A more widely shared global expansion would give the Pound's recovery a different foundation from a brief rise caused by disappointing US figures.
GBP/USD Exchange Rate FAQ
What is BofA's Pound-Dollar forecast?
The bank projects $1.37 at end-2026 and $1.45 at end-2027.
How far is $1.45 above the current rate?
Roughly 9.4% above the 13 October rate of $1.3250.
Does BofA expect UK interest rates to rise?
Its forecast includes November 2026 and February 2027 increases, conditional on persistent energy costs and no major downside data surprises.
