The financial markets have commenced the final week of 2024 with limited movements due to a decline in trading volume as the year comes to a close. Attention is primarily directed towards the U.S. economic data set to be released today, while the U.S. Dollar Index remains stable around the 108.00 mark, and U.S. stock futures are operating in negative territory.
GOLD
Gold prices have weakened during the European session, falling to $2,609 amidst persistently low trading volume as 2024 draws to a close. The drop in gold prices is primarily attributed to the U.S. dollar maintaining stability around the 108.00 level following a slight increase last week.
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This downturn is likely to be constrained by uncertainty surrounding the Trump administration and the expectation that the Federal Reserve may only implement minor interest rate cuts in 2025.
OIL
Oil prices have exhibited volatility in the European trading session, fueled by optimism regarding economic recovery in China, the world’s largest oil importer. This comes as the U.S. dollar remains steady around the 108.00 mark following a slight gain last week.
The outlook for oil remains bleak due to the market’s anticipation of a hawkish stance from the Federal Reserve, suggesting they might refrain from lowering interest rates next year.
EURUSD
The EURUSD pair has managed to rise to a daily high of 1.0444, driven by speculation that the European Central Bank (ECB) will delay further interest rate cuts due to recently rising inflation. ECB’s Robert Holzmann indicated that Trump’s tariff policies have slowed global growth while also increasing inflationary pressures.
GBPUSD
This currency pair also benefited from the positive performance of the EURUSD, with GBPUSD reaching a daily high of 1.2589, despite uncertainty surrounding the Bank of England (BoE), where policymakers are becoming increasingly divided regarding the need for interest rate cuts to counter economic slowdown.
Tonight, GBPUSD still has limited potential for gains, although trading volumes are low as the year ends.
USDJPY
The USDJPY remains stable near 157.825, with no significant sentiment shifts. The main driving catalyst appears to be speculation that the Bank of Japan (BoJ) may raise interest rates in January, as well as expectations that the Federal Reserve might only implement minor cuts in 2025.
NASDAQ
The Nasdaq has declined to 21.615, pressured by substantial selling activity that has affected technology and growth stocks, which previously led market gains. There remains a potential for continued selling pressure that could further weaken the Nasdaq in the short term.
