Portugal’s business confidence rose to 3.1 in December, up from the previous 3. This indicates that businesses in Portugal are feeling more optimistic as the year ended. In the foreign exchange market, the EUR/USD exchange rate adjusted to 1.1750, as the US dollar weakened on Friday. This shift happened even as Wall Street saw a decline, with focus shifting to upcoming data from the US and Europe.

GBP USD Rate Movement

The GBP/USD rate increased, nearly reaching 1.3500 after testing 1.3400. However, the gains were modest, influenced by holiday sentiments, with the pair hovering around 1.3490. Gold prices fluctuated slightly, dropping from $4,400 to about $4,320 in a single day. Despite this volatility, expectations of a dovish Fed and ongoing geopolitical concerns help support gold’s long-term stability. Cardano experienced a rise in early 2026, trading above $0.36 as market indicators pointed to a positive trend. Attention is on a potential breakout, supported by favorable market and on-chain data. The economic outlook for advanced countries in 2026-2027 is promising, following a resilient year globally. Key supportive factors from 2025 are expected to carry into 2026, suggesting good economic performance.

Markets And Economic Outlook

As markets reopen, trading is slow, and the Dow remains flat. Traders are waiting for the US jobs report next week, which will likely set the tone for coming weeks. For now, caution is advised as low liquidity could amplify small price movements. The U.S. Dollar is weakening, which is pushing the EUR/USD up to 1.1750 and keeping GBP/USD steady around 1.3500. This is due to expectations of a more dovish Federal Reserve in 2026, especially after core inflation data eased towards the end of 2025. The Fed’s December 2025 meeting hinted at multiple rate cuts this year, and markets are betting on the first cut by the second quarter. This expectation of lower rates is boosting Gold’s appeal, with prices remaining stable near $4,300 after touching $4,400. Traders should view Gold not just as a way to hedge against geopolitical risks, but also as a way to respond to shifts in monetary policy. Call options on gold-backed ETFs might be a good choice to capture potential upside if the upcoming jobs data is weak. The upcoming U.S. jobs report is a key turning point. We remember that the last jobs report of 2025 surprised positively, which briefly strengthened the dollar, so a similar outcome could cause a sharp reversal. A strong report with over 200,000 jobs added would challenge the rate cut narrative, while a weak report below 150,000 would reinforce it. Given this uncertain situation, buying straddles or strangles on major pairs like EUR/USD could be a smart strategy. This allows traders to profit from significant price shifts in either direction once the jobs data is released. The slow start to the year provides an opportunity to prepare for the volatility expected next week. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now