In October, US business inventories increased by 0.3%, which was higher than the expected 0.2%. This rise suggests that inventory levels in the US market were adjusted during this time. Gold prices surged above $4,600 due to a weaker US dollar and ongoing tensions in Iran. Likewise, WTI crude oil reached its highest point since late October, fueled by the unrest in Iran, which added to the risk premium.

Economic Discussions Include Federal Reserve’s Beige Book

Recent discussions have focused on the Federal Reserve’s Beige Book, which showed mild optimism about the economic outlook. Attention is also on US economic data, Federal Reserve communications, and UK GDP figures. In the 2026 financial sector, there are talks about top forex brokers and what they offer—ranging from low spreads to high leverage options. Guides are available to help traders choose brokers for assets like EUR/USD and gold in different regions. FXStreet offers informational content that includes forward-looking statements with potential risks and uncertainties. This content does not serve as specific trading or investment advice. It aims to inform readers and emphasizes the need for individual research before making investment choices. The U.S. dollar is under significant pressure due to concerns about the Federal Reserve’s independence, creating clear opportunities in currency markets. This weakness has driven pairs like GBP/USD higher, while gold is setting new records. Derivative traders should consider strategies that take advantage of continued dollar weakness in the coming weeks. Conflicting signals from the Fed are leading to increased market volatility, which can be beneficial for traders. Although the latest Beige Book expressed mild optimism, comments from officials like Bostic remind us that inflation challenges continue. After a calm period in late 2025, the VIX index has started to rise from around 13 to over 16, indicating that options premiums are likely to increase.

Geopolitical Risks Are Adding Premium To Commodities

Geopolitical risks are significantly raising commodity prices, especially for oil and gold. The ongoing unrest in Iran has pushed WTI to its highest levels since last October, and the combination of uncertainty and a weak dollar is helping gold rally past $4,600. Traders might consider using call options on futures for both assets to take advantage of further price increases while managing risk. The slightly higher-than-expected business inventories from October 2025 suggest that the economy may not be slowing down as quickly as anticipated. This aligns with a strong labor market, where the December 2025 jobs report indicated a solid addition of 216,000 jobs. This economic strength gives the Fed a reason to keep interest rates steady despite external pressures. This situation implies the market may be overly optimistic about the timing and depth of potential rate cuts this year. Core PCE inflation in November 2025 remained at 3.2%, still well above the Fed’s target of 2%. This creates opportunities in interest rate derivatives, positioning for a scenario where rates may stay higher for longer than currently expected. Create your live VT Markets account and start trading now.

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