High volatility in the financial markets continues as of Thursday and is expected to escalate today, Friday (March 7, 2025). This is due to the upcoming release of U.S. labor market data, including the non-farm payrolls (NFP), which will provide insights into economic conditions and potential monetary policy decisions by the Federal Reserve.
GOLD
Gold prices (XAUUSD) fell by $8.22 or 82.2 pips, settling at $2,910.71 per troy ounce during trading on Tuesday after dropping to $2,891.21 per troy ounce.
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The decline in gold prices comes after U.S. President Donald Trump postponed the increase of tariffs on automotive products and several other goods from Canada and Mexico. This move indicates that the trade war is not likely to escalate further in the near future.
This sentiment may continue to pressure gold prices during the European trading session ahead of the NFP data release.
OIL
Oil prices (CLS10) ended unchanged at $66.25 per barrel after experiencing volatility near a 10-month low. In addition to signs of an economic slowdown in the U.S., oil prices are also facing pressure from OPEC+’s plans to increase production starting next month.
This sentiment is expected to continue influencing oil price movements during the European trading session.
EURUSD
The EURUSD pair faced a round of profit taking on Thursday after climbing over 4,000 points (400 pips) in the preceding three days and reaching a four-month high. The currency pair closed Thursday’s trading at 1.07824, but climbed back to 1.08148 by Friday afternoon.
Positive sentiment for EURUSD was bolstered by Germany’s plans for fiscal reforms. Additionally, while the European Central Bank (ECB) has lowered interest rates, it indicated that this period of decline may soon come to an end. These factors continue to add to the bullish outlook for EURUSD during the European trading session.
GBPUSD
GBPUSD also experienced profit taking, dropping 143 points (14.3 pips) to 1.28779. Similar to EURUSD, this currency pair had seen a significant rise over three consecutive days before succumbing to profit taking.
Apart from benefiting from EURUSD’s rise, the prospect of the U.K. avoiding a trade war with the United States also provided positive sentiment for GBPUSD. This sentiment is expected to affect GBPUSD movements during the European trading session.
USDJPY
The weakness of the U.S. dollar is evident from the sharp drop of USDJPY by 900 points (90 pips) to 147.946 on Thursday, marking a five-month low. The U.S. dollar continues to face pressure due to signs of an economic slowdown.
Moreover, March is the end of the fiscal year in Japan, prompting many companies and institutional investors to repatriate funds and assets from abroad, leading to a stronger yen.
This sentiment is likely to continue exerting pressure on USDJPY during the European trading session.
Nasdaq
The Nasdaq fell 437 points to 20,173 on Thursday, reaching a four-month low. The Nasdaq remains under pressure and is close to falling below the 20,000 mark, despite Trump’s postponement of tariff increases on certain products.
This movement indicates that negative sentiment continues to loom over the stock index due to uncertainties surrounding import tariffs. Additionally, President Trump appears unconcerned about the recent decline in stock indices.
Such negative sentiment is expected to cloud Nasdaq movements during today’s trading.
