The NIESR estimates the UK’s GDP for December at 4.296%, a significant improvement from the earlier figure of -0.1%. The article discusses several key financial trends. The EUR/USD is now above 1.1900, suggesting a stronger Euro. At the same time, the GBP/USD has reached a high of 1.3750, fueled by a weakening US Dollar.

Gold and Cryptocurrency

Gold prices remain robust near $5,100 per ounce, driven by uncertainties in trade policies and geopolitical risks. Bitcoin is stable around $88,000 after a recent increase. Current global trade tensions are also mentioned, particularly President Trump’s escalating issues with South Korea. The Axie Infinity token has gained 3% due to rising retail demand. There are also forecasts for brokerage services in 2026, highlighting the best brokers for trading different assets. The article warns that markets involve risks, and all information is meant for informational purposes only. Thorough research is advised before making any investment. The author clarifies they are not responsible for any errors or losses from the provided information and emphasizes seeking professional advice.

UK Economy and Interest Rates

The UK’s latest growth estimate is impressive, showing a 4.3% increase, contrary to expectations of a slight contraction. This marks a remarkable turnaround from the technical recession experienced in late 2024 when the economy declined for two consecutive quarters. This unexpectedly strong data may lead the Bank of England to reconsider its future plans, making interest rate cuts unlikely. Given this context, it’s wise to consider call options on GBP/USD to capitalize on the Pound’s continued strength. UK inflation has remained higher than in other G7 countries throughout 2025, putting the BoE in a position where it might need to tighten further. If GBP/USD breaks above the current high of 1.3750, it could quickly move towards the 1.4000 level last seen years ago. Meanwhile, the US Dollar is facing broad selling pressure due to signs of a slowing job market and renewed trade war concerns. The recent ADP report shows the weakest private-sector hiring in over a year, giving the Federal Reserve plenty of reason to hold steady. The contrast between a potentially hawkish BoE and a dovish Fed is driving the currency markets. This widespread weakness makes put options on the Dollar Index (DXY) an appealing strategy. We are also seeing this reflected in EUR/USD, which is approaching levels not seen since mid-2021. The dollar’s path seems likely to trend downwards in the coming weeks. However, the political landscape adds risk that calls for hedging. Fears of new tariffs and ongoing tensions in the Middle East could lead to sudden market spikes. Buying out-of-the-money call options on the VIX can offer an inexpensive way to safeguard our portfolios from unexpected shocks. Gold’s rise towards $5,100 per ounce indicates that many investors are looking for a safe haven amid geopolitical uncertainty and long-term dollar depreciation. The price of gold has been steadily increasing since late 2025 as central banks have increased their purchases. Long positions via futures or call options should be considered a core strategy to benefit from ongoing risks. Create your live VT Markets account and start trading now.

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