The government shutdown in the United States has emerged as the primary force influencing the financial markets, particularly in yesterday’s trading session. High volatility has also affected various financial products. The shutdown (a temporary closure or limitation of services) is expected to persist this week, as the U.S. Senate is scheduled to be in recess on Thursday (October 2, 2025) in observance of Yom Kippur. Voting on the budget will not resume until Friday.
This sentiment will likely continue to impact market movements during today’s European trading session.
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GOLD
Gold prices reached a record high of approximately $3,895 per troy ounce yesterday before facing profit-taking that brought it down to close at $3,865.30 per troy ounce. This morning, prices decreased further to around $3,852.92 per troy ounce due to ongoing profit-taking activities.
The ongoing U.S. government shutdown remains a significant catalyst for Gold. The last shutdown occurred from December 22, 2018, to January 25, 2019, lasting 35 days, making it the longest in history. During that timeframe, Gold experienced a considerable increase. Looking back at past events, the current shutdown appears to provide a positive outlook for Gold.
OIL
Oil prices (CLS10) dropped by $0.64 to $61.78 per barrel in yesterday’s trading. Concerns regarding an increase in supply, following OPEC+’s plans to raise production levels, continue to exert pressure on oil prices.
On the demand side, both China and the United States show weakness, impacted by the shutdown. This sentiment will likely influence oil price fluctuations during the European trading session.
EURUSD
EURUSD experienced stagnation around 1.17281 in trading yesterday, after briefly rising to 1.17787. The increase in inflation within the eurozone, which did not exceed expectations, has contributed to a negative sentiment for EURUSD.
Nevertheless, the U.S. government’s shutdown continues to exert pressure on the dollar, resulting in a mildly positive sentiment for EURUSD.
GBPUSD
GBPUSD has marked a four-day winning streak, closing yesterday’s trading at 1.34708. Compared to Tuesday’s close, GBPUSD saw an increase of 324 points (32.4 pips).
In the absence of significant economic data releases from the UK, the continued rise of GBPUSD illustrates the pressure faced by the U.S. dollar as a result of the ongoing shutdown. This sentiment is expected to influence market movements during the European trading session.
USDJPY
USDJPY plummeted by 855 points (85.5 pips) to 147.000 in yesterday’s trading session. USDJPY has also recorded a significant decline across four consecutive days, totaling more than 2,700 points (270 pips).
The U.S. dollar is currently under pressure due to the shutdown, while the yen has shown strength following the release of BoJ meeting minutes that suggest a potential rate hike this month.
These two factors could continue to weigh on USDJPY during the European trading session.
NASDAQ
The Nasdaq index closed the trading session yesterday at 25,008, having briefly dropped to 24,633. Today, the Nasdaq has increased again to 25,076, marking a new all-time high.
Surprisingly, Nasdaq has overlooked the negative impact of the shutdown of the U.S. government. Market participants recall Nasdaq’s performance during the shutdown that took place from late 2018 to early 2019. Although there was an initial drop, the Nasdaq consistently rose afterwards.
