On Friday, multiple financial platforms were disrupted due to technical issues at the Chicago Mercantile Exchange (CME), which came to a halt when prices were quoted inconsistently due to a cooling problem at one of their data centers.
The power outage affected the Globex futures options, bonds, and equities, causing difficulties and delays in price adjustments on the Electronic Broking Services (EBS), an electronic foreign exchange trading platform. The system took considerable time to recover. After a late start, the issue was completely resolved after eleven hours, allowing operations to resume normally.
In the meantime, following the conclusion of the US government shutdown, delayed economic data was released, including retail sales figures that suggested a slowdown in consumer demand.
The US Dollar index (DXY) stood at 99.49, showing a slight increase over the past month, but it remains down 5.91 percent year-to-date. For the upcoming week, the outlook appears slightly downcast.
In the United Kingdom, the autumn budget was unveiled, which included tax increases aimed at tightening fiscal policy and providing a buffer for debt repayments. Notably, the VAT was not raised, allowing the Bank of England more flexibility for potential interest rate cuts in December. This situation has positively affected the Pound Sterling, which has rebounded after a couple of weeks of softer performance.
However, despite the recent gains in the British currency, its future trajectory will largely depend on the health of the economy, which still indicates lower growth and productivity. An additional challenge for the Pound is the postponement of tax measures until 2029.
Last week in my column for Business Recorder, I warned that the market was likely to face another turbulent period, and that turned out to be accurate as gold fluctuated within a range of nearly USD 200.
It approached a critical resistance level but struggled to reach USD 4,260.
While there is still potential for gold to rise, it requires a weekly close above USD 4,285 to sustain the upward momentum. Although there has been some positive movement in the geopolitical landscape, the fundamentals remain unchanged, with central banks consistently purchasing and expanding their portfolios.
The anticipation of rate cuts is certainly bolstering gold’s upward trajectory, and any peace agreement or disagreement between Russia and Ukraine will play a significant role in determining future direction.
As always, US economic data will provide traders with opportunities for both upward and downward maneuvers.
This week promises to be busy in terms of US data.
On Monday, the ISM Manufacturing PMI for November and the ISM Services PMI will be released, followed by the ADP private employment figures on Wednesday.
Thursday will feature the weekly jobless claims report, and the week will conclude with the October Core PCE data and the University of Michigan’s preliminary Consumer Sentiment Survey for December.
WEEKLY OUTLOOK — DEC 1-5
GOLD @ USD 4230 — Following the abrupt rise and a solid close near USD 4230, there appears to be an additional upside potential to test and possibly move above USD 4255 to reach USD 4332; the price must surpass USD 4285. Nevertheless, it is crucial that the support level at USD 4122 remains intact. Otherwise, the level at USD 4080 might be put to the test.
EURO @ 1.1596 — The Euro is currently supported at 1.1505, a level that is expected to hold as it moves toward 1.1698. A breakout could pave the way for a rise to 1.1770. However, a drop below this support level could lead to testing 1.1450.
GBP @ 1.3238 — Pound Sterling must surpass 1.3295 to move toward 1.3392. However, there is a risk of decline. If it breaks below 1.315, it could trigger a shift toward 1.3060.
JPY @ 156.18 — The US$/YEN pair faces significant resistance at 157.70 and as long as it remains below that level, downside risks persist. A drop beneath 155.02 will drive it down to 154.10. Otherwise 158.10.
Copyright Business Recorder, 2025
The writer is former Country Treasurer of Chase Manhattan Bank. The views expressed in this article are not necessarily those of the newspaper
He tweets @asadcmka
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