Daily Analysis 08/09/2025

• GBP/USD Price: GBP/USD edged higher to around 1.3500 in early European trading on Monday, supported by a modest rebound in the US Dollar. Momentum remains cautious but mildly positive.
• US Labor Market: The US jobs report showed the unemployment rate rising to 4.3% in August from 4.2%, in line with expectations. Average hourly earnings slowed to 3.7% y/y, pointing to cooling wage-driven inflation, while participation edged up slightly.
• Fed Policy: Chicago Fed President Austan Goolsbee said uncertainty over tariffs’ impact on inflation and the labor market makes a September rate cut less certain, keeping traders focused on incoming data.
• UK Domestic Policy: The UK Defence Ministry pledged £250mn in local spending as part of a new “defence industrial strategy”, aimed at boosting regional economies and industrial resilience.
• Next Data: Market attention now shifts to the upcoming US CPI release, which will be crucial in shaping expectations for a Fed rate cut at the September 16–17 meeting.

Closing statement: GBP/USD holds near 1.3500, balancing a softer US labor market with cautious Fed rhetoric. The pair’s next big driver will be US CPI data, which could cement or challenge September rate cut bets.

• XAU/USD Price: Gold (XAU/USD) is consolidating near $3,600 per ounce, just below Friday’s all-time high, as traders digest recent gains and await fresh catalysts.
• Fed Rate Cut: Markets are reacting to the weak NFP report, now pricing in a small chance of a jumbo Fed rate cut in September and up to three cuts by year-end, a dovish shift in sentiment.
• Trade Policy: The Trump administration exempted gold bullion from tariffs, reversing weeks of uncertainty after US Customs had flagged bullion for import taxes. The move removed a potential headwind for the metal.
• Chinese Reserves: The People’s Bank of China increased gold reserves for the 10th straight month in August, highlighting persistent diversification away from the US dollar and adding long-term support for bullion demand.
• Barclays’ Outlook: Barclays revised its call to three Fed rate cuts this year, up from two, reinforcing the supportive macro backdrop for gold in the medium term.

Closing statement: Gold consolidates just shy of record highs, supported by dovish Fed bets, tariff exemptions, and strong central bank demand. The next drivers will be US CPI data and Fed commentary, which could determine whether prices break sustainably above $3,600.

• Crude Oil Price: WTI crude oil trades around $62.60 per barrel, rebounding modestly after last week’s 4% decline, supported by early-week buying in Europe.
• OPEC+ Output: OPEC+ confirmed it will add to its scheduled production increase next month. While widely expected, the news kept supply-side pressure intact and contributed to last week’s price drop.
• Russian Exports: Russia continues to find ample buyers, with seaborne exports up nearly 30% to 3.5M bpd in the latest reporting week. Shipments to China and India are rising, keeping Russian flows resilient despite Western sanctions.
• August Production: A Bloomberg survey showed OPEC output rose to 28.55M bpd in August, an increase of 400,000 bpd from July, broadly matching the cartel’s agreed supply targets.
• US-Japan Trade: President Trump signed an executive order cutting tariffs on Japanese autos to 15% from 27.5%, part of a wider economic package. The deal includes $550B in Japanese investment in US infrastructure, energy, and semiconductors, alongside expanded Japanese LNG purchases.

Closing statement: Oil prices are attempting to stabilize after last week’s drop, but OPEC+ supply growth and resilient Russian exports keep upside limited. Traders now look to demand-side catalysts and US data to balance the bearish supply narrative.

• DAX Price: The DAX starts the week on a positive note, trading higher at around 23,740 points after two consecutive weeks of losses, showing signs of stabilization.
• Trade Balance: Germany’s July trade surplus narrowed to €14.7B, below expectations of €15.3B, as exports fell more than anticipated while imports declined less, signaling softening external demand.
• Industrial Production: Industrial output rose 1.3% MoM in July, topping forecasts of +1.0%. Excluding volatile energy and construction sectors, production surged 2.2%, indicating underlying strength in Germany’s industrial base.
• Industrial Recovery: Eurozone industrial production jumped 1.3% MoM in July, recovering from June’s -1.9% drop. The improvement suggests the region’s manufacturing sector is stabilizing after recent weakness.
• Upcoming Events: Markets turn their attention to the US CPI report for August and the ECB meeting this week, both potential catalysts for risk sentiment and DAX direction.

Closing statement: The DAX is rebounding, supported by stronger German and Eurozone industrial output, but weaker trade data highlights ongoing challenges. The index’s next move hinges on ECB policy signals and US inflation data.