The US dollar index experienced a significant drop at the start of trading on Wednesday (December 3, 2025). The market continues to be influenced by rising expectations for interest rate cuts from the Federal Reserve, bolstered by various dovish signals. The pressure on the US dollar deepened further when Kevin Hassett, a leading candidate to succeed Jerome Powell as Fed Governor, indicated that President Donald Trump is likely to choose someone who supports lowering interest rates.
Additionally, economic data from the US showing signs of weakness has impacted the markets as well. However, market participants are anticipating the release of crucial economic data to gain clearer insights into the future direction of the Fed’s monetary policy.
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These sentiments are expected to continue influencing the market during European trading sessions. It is essential to pay attention to upcoming important economic releases. Here’s the Trading Central data:
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Eurozone Producer Price Index (PPI) year-on-year (Oct) at 17:00 WIB; forecast -0.2% vs previous -0.4%
GOLD
Gold prices (XAUUSD) dipped to $4,162.66 per troy ounce before closing down $26.4, or 264 pips, at $4,205.25 in yesterday’s trading. This decline was driven by ongoing profit-taking activity.
As European trading approached, Gold regained its footing. The increased expectations for Fed interest rate cuts, fueled by a host of dovish signals and weakening US economic data, have become the primary drivers for Gold. Market players are now looking forward to the next release of US economic data as a guide for interest rate direction at the Fed meeting next week.
These sentiments are anticipated to continue impacting Gold throughout the European session.
For clarity, the spread on Gold products (XAUUSD) widened last Friday (November 28, 2025) due to technical difficulties experienced by the Chicago Mercantile Exchange (CME), which serves as a key benchmark for gold pricing and liquidity worldwide. The technical issues have since been resolved by the CME, and the Gold product spreads have returned to normal.
OIL
Crude oil prices (CLS10) fell by $0.92 to $58.58 per barrel during yesterday’s trading session. Ongoing discussions about peace between Russia and Ukraine remain a market focal point, especially due to the potential lifting of sanctions that could lead to a resurgence of Russian oil supplies flooding the global market and raising concerns about oversupply.
In recent updates, US envoy Steve Witkoff is scheduled to meet with Russian President Vladimir Putin in Moscow to discuss possible peace agreements.
This sentiment is expected to continue affecting oil prices during the European session.
EURUSD
EURUSD gained 161 points or 16 pips, reaching 1.16383 in yesterday’s trading, marking a third consecutive day of increases and continuing to strengthen today. Accelerated inflation in the eurozone during November has positively influenced EURUSD. Meanwhile, the weakness of the US dollar in light of expected interest rate cuts from the Fed has provided further support.
However, if the eurozone PPI data is released lower than forecasted, it may exert pressure on EURUSD during the European session.
GBPUSD
GBPUSD experienced volatility before ultimately closing unchanged at 1.32067 in yesterday’s trading. As the European session approaches, GBPUSD is attempting to strengthen again amidst a weakened US dollar.
However, negative sentiment from Bank of England (BoE) official Megan Greene’s assertion that disinflation is still ongoing is fueling market expectations that the BoE may cut interest rates soon. This limits the potential for GBPUSD to strengthen substantially.
These sentiments are likely to continue affecting GBPUSD in the European session.
USDJPY
USDJPY initially rose to 156.174 before correcting and closing up 391 points or 39 pips at 155.794 on Tuesday. As the European session draws near, USDJPY is showing signs of weakness again. This currency pair is under pressure from expectations of potential interest rate hikes by the Bank of Japan (BoJ) this month, combined with the declining US dollar due to anticipated Fed rate cuts.
This sentiment is expected to continue putting pressure on USDJPY during European trading.
NASDAQ
The Nasdaq index climbed 207 points to 25,606 in yesterday’s trading and continues to strengthen today. A rebound in technology stocks has been the main catalyst, alongside the outlook for Fed interest rate cuts next week, which continues to bolster market sentiment.
This sentiment is expected to keep influencing the Nasdaq throughout the European session.
