The financial markets experienced significant volatility over the past week, impacted by actions taken by U.S. President Donald Trump. On Friday (October 10, 2025), Trump surprised the financial world by imposing a 100% tariff on all imports from China and simultaneously canceled a scheduled meeting with President Xi Jinping.
This announcement caused Gold prices, typically regarded as a safe haven asset, to surge in the previous week, while the dollar faced downward pressure along with stock indices. However, the market direction reversed on Friday (October 17, 2025) as Trump softened his stance, indicating that a meeting with Xi Jinping might be possible by the end of the month.
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This sentiment is likely to continue influencing market movements during the European trading session on Monday (October 20, 2025), in addition to economic data releases. Here are the key figures from Trading Central:
- German Producer Price Index (PPI) (month-on-month/September) at 13:00 WIB; forecast -0.2% vs previous 0.5%.
- German Producer Price Index (PPI) (year-on-year/September) at 13:00 WIB; forecast -1.9% vs previous -2.2%.
GOLD
Gold prices (XAUUSD) surged to $4,379 per troy ounce last week, marking a new record high. The increase noted was over $360 or 3,600 pips during the week leading to this peak.
With Trump’s softened approach, Gold faced profit taking and closed Friday’s trading at $4,251.11 per troy ounce. This change in Trump’s stance has reduced the risk of heightened trade tensions between the U.S. and China, diminishing Gold’s appeal as a safe haven asset, leading to potential continued profit-taking in the European session.
OIL
Oil prices (CLS10) dropped by over $1 throughout the past week, ending at $57.25 per barrel. Oil touched its lowest level in over five months due to concerns about demand dropping as the global economy could slow down amidst escalating U.S.-China trade tensions.
Today’s trading shows that economic data from China indicates a slowdown in economic growth for Q3 2025. As the second-largest oil consumer globally, a declining Chinese economy poses risks to oil demand.
The release of this economic data from China could further apply pressure on oil prices in the European market.
EURUSD
EURUSD rose to 1.17284 last Friday before reversing and closing at 1.16509. Nevertheless, the pair recorded a weekly gain of 275 points (27.5 pips).
The dollar rebounded last Friday following Trump’s softened stance, which decreased the risk of escalating trade tensions between the U.S. and China.
The release of the German PPI data today could influence EURUSD movements. Should the PPI come in below forecast, as indicated above, it may place EURUSD under further pressure. A significant negative PPI suggests weak future inflation (consumer price index/CPI), which could also see declines. Germany is the largest economy in Europe, and any CPI slowdown may impact other countries, thus creating a negative sentiment for EURUSD.
GBPUSD
GBPUSD traded with volatility last Friday before closing nearly unchanged at 1.34237. Over the week, GBPUSD recorded an increase of 661 points (66.1 pips).
GBPUSD managed to sustain against the strengthening dollar, as Bank of England officials see substantial inflation risks. Thus, it is likely that the BoE may not reduce interest rates soon.
This sentiment will likely affect GBPUSD movements during the European session.
USDJPY
USDJPY fell to 149.378 on Friday, hitting a two-week low. Subsequently, the pair rebounded and closed at 150.621. However, it still dropped 533 points (53.3 pips) over the week.
The USDJPY rebound was triggered by a reduction in U.S.-China trade war risks, briefly rising to 151.202 before correcting. Given the prospects of Trump meeting with Xi Jinping, USDJPY may still experience positive sentiments in the European session.
NASDAQ
The easing of Trump’s stance enabled the Nasdaq to close last Friday at 25,031 after falling to 24,410. For the week, Nasdaq successfully recorded an increase of 855 index points.
The positive sentiment from Trump’s softened approach will likely continue to affect Nasdaq movements during the European trading session. Furthermore, the decrease in concerns regarding potential regional bank credit defaults in the U.S. also boosts stock index performance.
