The average hourly earnings in the United States rose by 3.9% year-on-year in July, beating expectations of 3.8%. This indicates wage growth is rising alongside broader economic trends. The EUR/USD pair increased, trading above 1.1550, due to weak US employment and ISM Manufacturing PMI data. Likewise, GBP/USD bounced back, moving past 1.3250 after some losses, thanks to the same US data. Gold hit new weekly highs of around $3,350, driven by lower US Treasury bond yields after disappointing NFP data. In the cryptocurrency arena, Bitcoin dropped below $115,000, influenced by increased liquidations. The focus remains on the $112,000 support level as the market adjusts after a strong July with record highs. The euro area economy shows good resilience, aided by the EU-US deal and plans for the German economy. However, if wage indicators weaken further, there might be risks for rate cuts by early 2026. Foreign exchange trading carries significant risk due to leverage and may not suit everyone. It’s essential to understand these risks and consider consulting an independent financial advisor. Recent data from July 2025 shows mixed signals from the US economy. The surprising 3.9% rise in average hourly earnings hints that inflation could stay high, even though other employment figures seem weak. This uncertainty makes it hard to predict the Federal Reserve’s next action, likely increasing market volatility soon. We’re seeing a notable weakening of the US dollar, creating chances in currency trading. With EUR/USD above 1.1550, strategies taking advantage of continued dollar weakness are worth considering, as the market expects a less aggressive Fed. This represents a sharp reversal from the Fed’s tough stance throughout 2024. Gold’s rise to $3,350 corresponds with falling US Treasury yields, which have dropped below 3.5% for the first time this year. This trend is likely to continue as weak US data puts downward pressure on yields, making non-yielding gold more appealing—similar to the trend seen during the uncertainty of 2023. In crypto, Bitcoin’s dip below $115,000 is viewed as a consolidation phase rather than a peak. This pullback follows a significant rally from the 2024 halving event, which usually leads to price growth in the following 12-18 months. We should keep an eye on the $112,000 support level for a chance to buy back in. The European economy is showing strength, partly due to a recent EU-US trade deal, standing in contrast to the slowing US momentum. While the outlook is positive for now, we need to be alert to the European Central Bank’s suggestions of possible rate cuts in early 2026, which could lead to future volatility and trading opportunities in euro-denominated assets. Given this mix of factors, managing risk is crucial. Using leverage in foreign exchange and other derivatives can lead to significant losses in a volatile market. It’s vital to fully understand these risks before investing in new positions.

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