The US dollar continues to face pressure during European trading on Friday (December 5, 2025). Market attention this evening is primarily directed towards the release of the personal consumption expenditure (PCE) inflation data, which will play a crucial role in determining the direction of the Federal Reserve’s interest rate policy next week.
On the fundamental front, there have been no significant changes. The expectations for a rate cut by the Fed remain strong due to dovish signals from Fed officials and signs of weakening in the US labor market, as indicated by private data from ADP and Challenger.
Recommended
Recommended
Recommended
Recommended
These sentiments will continue to impact market movements in the US trading session. It is essential to pay attention to upcoming economic data. Here is the data from Trading Central:
-
US personal consumption expenditure (PCE) inflation (year-on-year/Sept) at 22:00 WIB; forecast 2.8% vs previous 2.7%
-
Core PCE inflation (year-on-year/Sept) at 22:00 WIB; forecast 2.8% vs previous 2.9%
GOLD
Gold prices (XAUUSD) rebounded, rising $22.36 or 223.6 pips to $4,230.63 per troy ounce during the European session, after dropping below $4,200 earlier in the morning. The primary sentiment driving this change comes from expectations of a Fed rate cut next week, confirmed by ADP and Challenger labor data indicating market weakness.
Tonight, crucial economic data remains a focal point. Should actual figures come in lower than the forecast, Gold could continue its upward trajectory due to increasing possibilities for a Fed rate cut.
It is worth noting that the spread on Gold (XAUUSD) products widened last Friday (November 28, 2025) due to technical difficulties at the Chicago Mercantile Exchange (CME), one of the main benchmarks for gold pricing and liquidity worldwide. Those technical issues have since been resolved by CME, returning the spread on Gold products back to normal.
OIL
Oil prices (CLS10) dipped by $0.29 to $59.41 during the European session. However, Oil is still buoyed by positive sentiment stemming from the failure of peace negotiations between Russia and Ukraine, as well as Ukrainian drone attacks on Russian oil infrastructure, which tighten global supply prospects.
Additionally, rising tensions between the US and Venezuela are a point of concern. President Donald Trump hinted at potential actions that could threaten Venezuela’s oil production of 1.1 million barrels per day, a factor easing oversupply worries.
This sentiment opens the door for potential increases in Oil prices during the US session.
EURUSD
EURUSD increased by 295 points, or 29.5 pips, to 1.16718 during the European session. German factory orders showed a rise of 1.5%, exceeding the forecast of 0.4% and the previous figure of 1.1%, indicating strengthening in the German economy and providing positive sentiment for EURUSD. Accelerating inflation in the eurozone and improved retail sales further support this outlook.
Meanwhile, the US dollar continues to feel the pressure of anticipated Fed rate cuts.
Tonight, if important economic data is released lower than expectations, EURUSD could strengthen further due to additional pressure on the US dollar.
GBPUSD
GBPUSD rose by 299 points or 29.9 pips to 1.33517 during the European session. The weakening of the US dollar due to expectations of rate cuts has been the main driver of this increase.
However, important economic data released tonight will be under keen scrutiny. If the data falls short of forecasts, GBPUSD could strengthen alongside the weakening dollar.
USDJPY
USDJPY continued to decline, down 696 points or 69.6 pips to 154.322 in the European session. The yen has been bolstered by speculation surrounding a potential interest rate hike from the Bank of Japan (BoJ) this month, while the US dollar remains under pressure from expected Fed rate cuts.
If this evening’s economic data is released below predictions, USDJPY has a chance to weaken further alongside a declining dollar.
NASDAQ
The Nasdaq gained 111 points, reaching 25,743 during the European session. A rebound in Nvidia and Meta stocks has been the primary catalyst, paired with ongoing strong expectations for a Fed rate cut next week.
However, significant economic data released tonight could be pivotal. If outcomes fall short of forecasts, the Nasdaq may gain momentum as the chances for a rate cut increase.
