Daily Analysis 12/01/2026

• GBP/USD Price: GBP/USD attracts strong demand and climbs toward the 1.3450 area in early European trading. The move suggests short-term bullish positioning after recent consolidation, helped by a softer US Dollar tone.
• Labor Market: UK labor market conditions remained fragile in 2025, with firms slowing hiring to absorb higher employers’ social security contributions. This structural pressure continues to weigh on growth and limits the Pound’s medium-term upside.
• Unemployment Rate: The UK Unemployment Rate rose to 5.1% in October, the highest level since March 2021. The increase reinforces expectations that labor market slack is building, which could eventually push the BoE toward a more accommodative stance.
• Inflation Expectations: The University of Michigan survey showed a modest rise in long-term US inflation expectations, while short-term expectations remained elevated. This dynamic could keep the Federal Reserve cautious, offering intermittent support to the US Dollar.
• Jobs Data: Markets are closely watching the upcoming UK employment report, which could be pivotal for shaping BoE policy expectations. A weaker-than-expected print would likely revive rate-cut bets and pressure Sterling.

Closing statement: GBP/USD may remain supported in the short term, but upside looks fragile given deteriorating UK labor market conditions. Strong UK jobs data could extend gains toward recent highs, while further labor market weakness may shift the balance back in favor of the US Dollar and cap rallies.

• XAU/USD Price: Gold retains a bullish bias but shows selling pressure just below the $4,600 psychological level, pulling back from recent all-time peaks amid profit-taking and mixed sentiment.
• Fed Turmoil: Fed Chair Jerome Powell revealed that the DOJ issued grand jury subpoenas threatening a possible criminal indictment related to his congressional testimony, raising market concerns about political pressure on central bank independence.
• Dollar Impact: This unprecedented clash between the US administration and the Fed has weighed on the US Dollar, contributing to gold’s safe-haven appeal as monetary policy credibility uncertainties rise.
• Venezuela Risk: Ongoing political developments in Venezuela and other geopolitical flashpoints have kept markets uneasy, bolstering demand for defensive assets such as gold.
• Data Drought: With no major US economic releases scheduled today, XAU/USD price action will likely be driven by comments from influential policymakers and risk headlines rather than fresh macro data.

Closing statement: Gold remains structurally bullish, anchored by safe-haven demand and growing concerns about US monetary policy credibility and geopolitical risks. Near-term resistance around $4,600–4,620 might cap rallies, but if political and geopolitical tensions intensify or the US Dollar weakens further, XAU/USD could extend gains toward new record highs.

• Crude Oil Price: West Texas Intermediate (WTI) is attempting to extend gains for a third straight session, trading around $58.80 a barrel during the European hours on Monday, as geopolitical risk premiums remain supportive.
• Infrastructure Strike: A Ukrainian drone strike ignited a fire at an oil depot in Russia’s Volgograd region over the weekend, heightening concerns about Russian energy infrastructure disruption.
• Iran Tensions: Escalating unrest in Iran has sparked geopolitical risk around OPEC supplies. US President Donald Trump publicly threatened repercussions if Iranian authorities further crack down on protesters, adding to oil supply risk narratives.
• Venezuela Supply: Despite bullish price action, expectations that Venezuelan oil exports could resume—with up to 50 million barrels potentially entering US markets—continue to weigh on prices as the market anticipates increased supply.
• Corporate Dispute: Exxon Mobil recently said it would not invest in Venezuela, which prompted a direct response from President Trump, who stated that Exxon would be excluded from Venezuelan oil operations, highlighting ongoing uncertainty over future oil exports and foreign investment.

Closing statement: WTI’s attempt to sustain gains suggests near-term bullish momentum remains intact, supported by geopolitical risk and concerns about supply disruptions. However, broader oversupply expectations and potential Venezuelan crude flows could cap upside. A break above $59–$60 could signal further bullish continuation, while failure to hold above the mid-$58 area may open the door for a pullback toward the $56–$57 range in the near term.

• DAX Price: The DAX Index edged higher by 0.02% on Monday, trading around 25,225 points, as gains remain modest following the recent push to record territory.
• Macro Spillover: The US December jobs report came in close to expectations, with Nonfarm Payrolls rising by 50k (vs 60k expected). The unemployment rate fell to 4.4%, largely due to strong household job growth and a contraction in labor supply, supporting global risk sentiment.
• Growth Outlook: Attention now turns to Germany’s full-year 2025 GDP estimate, due Thursday, which will offer clearer insight into Q4 economic momentum amid a fragile recovery narrative.
• Eurozone Sentiment: The Sentix investor confidence index is released today, providing the first read on sentiment for 2026. While confidence improved over 2025, the year ended on a weaker note, suggesting lingering caution among investors.
• Political Risk: Markets are also monitoring a US Supreme Court ruling expected Wednesday on President Trump’s use of emergency tariff powers, which could have broader implications for global trade and export-heavy European equities.

Closing statement: The DAX remains constructively supported above 25,000, with resilient global risk sentiment and expectations of stabilizing growth acting as tailwinds. However, upside momentum may stay limited ahead of key German GDP data and trade-related legal risks. A sustained move above 25,300–25,400 could open room for further gains, while disappointment on growth or tariffs could trigger a pullback toward the 25,000 support zone.