New Zealand’s employment rate for the third quarter remained unchanged at 0%. This is lower than the expected increase of 0.1%. Meanwhile, the People’s Bank of China set the USD/CNY reference rate at 7.0901, up from 7.0885. China’s services PMI fell to 52.6 in October, which was in line with predictions. The EUR/USD currency pair remained stable, trading close to 1.1500, as many believe the European Central Bank will adopt a cautious approach in their next meeting. On the other hand, the GBP/USD experienced further declines, dropping below 1.3100 and falling by about 0.9% in a single session. Gold faced pressure, trading below $3,850 due to a stronger US Dollar, although lower US Treasury bond yields offered some support. Ethereum’s price fell below $3,500 due to ETF outflows, reflecting a negative trend in the cryptocurrency market.

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Impact on Australian Dollar

We are keeping an eye on the Australian dollar as it hovers around 0.6450, influenced by signs of a slowdown in China. China’s services PMI, while still in growth territory, has decreased for two months in a row, raising concerns about demand for Australian commodities. This adds to a cautious outlook for the AUD, particularly against the US dollar. The Euro is stable near 1.1500, but we believe its upward potential is limited by the cautious stance of the European Central Bank. The market has already ruled out any further rate hikes, and the latest ECB meeting minutes from October 2025 suggest they may shift towards cuts next year. This indicates a likely range-bound market for EUR/USD, making low-volatility strategies, like selling strangles, worth considering. Gold’s inability to break past $3,850, despite geopolitical tensions, shows the strong influence of the US dollar. Following a significant increase from the $2,000 level over the past two years, its momentum seems to be fading. We believe the precious metal is stuck between supportive but declining US Treasury yields and a strong dollar, limiting its immediate gains. In the crypto markets, Ethereum’s drop below $3,500 is a warning, driven by profit-taking from institutional investors. We have seen consistent outflows from major Ether ETFs over the last three weeks, reversing the heavy inflows following their approval in 2024. This decline indicates less confidence among larger investors, making protective puts a wise choice for those holding crypto assets. Create your live VT Markets account and start trading now.

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