The rising tensions of a trade war between the United States and China continue to heavily influence the financial markets as European trading opened on Tuesday (October 14, 2025). Recently, President Donald Trump announced a dramatic increase in import tariffs from China by 100%. In response, China has threatened to retaliate unless these tariffs are rescinded.
Additionally, the escalating conflict between Russia and Ukraine remains a critical concern. Trump has issued a stark warning to Russia, indicating that he would supply Tomahawk missiles to Ukraine in order to bring a close to the ongoing war. This action comes as the hostilities between Russia and Ukraine remain unresolved.
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On the other hand, Russia has cautioned that the provision of long-range missiles to Ukraine could lead to a “significant escalation of warfare.” Such sentiments are likely to impact gold’s movement in tonight’s trading.
GOLD
Gold prices (XAUUSD) have experienced a round of profit-taking after hitting an all-time high of US$4,179.71 per troy ounce. At one point, gold prices dipped to US$4,090.40 per troy ounce before experiencing a rebound.
This trend indicates that the demand for gold as a safe haven asset remains robust, largely due to the threats posed by the US-China trade war and the ongoing Russia-Ukraine conflict.
Such market sentiment is expected to continue influencing gold prices during tonight’s trading session.
OIL
Oil prices (CLS10) plummeted to US$57.99 per barrel, marking a decline of US$1.55 from the previous trading session and reaching its lowest level in five months.
The oil market continues to be pressured by the escalating trade war risks between the US and China. If tensions rise further, the global economy could slow down, potentially leading to a decreased demand for oil, which would further drag down prices.
EURUSD
The EURUSD pair fell to US$1.15418 early in the European session after peaking at 1.15936 earlier in the morning. The EURUSD remains under pressure despite the ZEW releasing German consumer sentiment data for this month at 39.3, higher than the forecast of 38 by Trading Central, and an increase from last month’s 37.3.
The improved economic sentiment in Germany has not been enough to bolster the EURUSD’s performance. This suggests that other factors are at play, including political turmoil in France and the risks associated with the escalating Russia-Ukraine conflict.
Such influences are expected to continue affecting the EURUSD movements today.
GBPUSD
The GBPUSD currency pair tumbled by 770 points (77 pips) to 1.32510 at the start of the European trading session, reaching its lowest point in over two months.
The GBPUSD faced downward pressure following data that revealed a UK unemployment rate of 4.8% in August, which is higher than the Trading Central forecast of 4.7% and the previous month’s rate of 4.7%. Meanwhile, the employment change recorded a total of 91,000, exceeding the forecast of 70,000, but falling significantly short of July’s figure of 232,000.
This data indicates a weakening UK labor market, putting pressure on the GBPUSD.
USDJPY
The USDJPY pair exhibited volatility within a range of 151.620 – 152.610 at the beginning of the European trading session. The extreme volatility in USDJPY can be attributed to the trade war risks between the US and China, compounded by the potential intensification of the Russia-Ukraine conflict.
Considering that the US-China trade war could negatively impact the US economy, market participants seem to be leaning towards the yen, which is also regarded as a safe haven asset. Therefore, there’s a possibility that the USDJPY may face downward pressure this evening.
NASDAQ
The Nasdaq index dropped to 24,540 at the start of the European trading session, reflecting a sharp decrease of 364 index points compared to the close of the previous trading day.
This downward movement indicates that the Nasdaq continues to be affected by negative sentiments stemming from trade war risks between the US and China. With the added concern of escalating tensions in the Russia-Ukraine conflict, there is a likelihood that the Nasdaq will again encounter pressure during tonight’s trading.
