**Canada’s Economic Forecast** Currency changes show the GBP/USD dropping to daily lows around 1.3360 after disappointing UK data. The EUR/USD feels slight pressure near 1.1730, influenced by the strengthening US dollar. Gold struggles at $4,300 per troy ounce, while Litecoin stabilizes above $80 but has difficulty keeping earlier gains. Despite a recent rate cut by the Fed, the S&P 500 rose, impacting various market sectors. Aave’s price is approaching a breakout, trading above $204 and nearing the upper boundary of its descending parallel channel. In 2025, multiple broker evaluations will cater to different trading needs. Options include brokers with low spreads, high leverage, Islamic accounts, and those focused on trading EUR/USD or Gold. This information is for reference only and carries potential risks. It’s crucial to conduct thorough research before making investment choices. The views presented are those of the authors and do not necessarily reflect those of FXStreet or its advertisers. **Canadian Economy and Investment Strategies** As of December 12, 2025, a weaker-than-expected Canadian capacity utilization figure suggests the economy is slowing as we head into the new year. This opens an opportunity for bearish positions on the loonie, possibly using put options on the CAD/USD pair. This perspective is supported by Statistics Canada indicating a surprising 0.4% drop in retail sales for October 2025. With UK GDP shrinking again, all eyes are on the Bank of England meeting set for December 18th. We anticipate that the weakening economy, echoing the challenges faced during the post-pandemic recovery of 2023-2024, will lead policymakers to adopt a dovish stance. Look to capitalize on further sterling weakness against the dollar, potentially through shorting GBP/USD futures ahead of the meeting. The Federal Reserve’s recent rate cut appears to be a “one-and-done” for now. The dollar seems stable, and the 2-year yield remains around 3.50%. This suggests traders might use options to bet both ways on the EUR/USD, as the pair appears stagnant until clearer guidance comes from Fed officials. Current market pricing from the CME FedWatch tool indicates an over 80% chance that the Fed will keep rates steady at the January 2026 meeting. The breakout in gold and silver to record highs is noteworthy, indicating a strong trend. We should consider using call options to gain exposure while managing risk, as momentum looks solid. This rally is driven by ongoing inflation concerns and significant central bank buying, a trend that has been growing since the record purchases in 2022. The Japanese yen continues to seem weak, and we expect this to last through the upcoming Bank of Japan policy decision. The ongoing interest rate difference between Japan and other major economies makes shorting the yen an appealing carry trade. With Japan’s national core CPI for November 2025 at just 0.5% year-over-year, the BoJ has little reason to surprise the market with a hawkish shift. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now