**In China: US Relations and Market Impacts** In the forex market, the EUR/USD pair is dropping toward 1.1550 due to the strength of the US dollar. The GBP/USD fell by 0.13% as the dollar regained ground, and gold prices are rising amid geopolitical uncertainties. In the world of cryptocurrencies, Dogecoin bounced back past $0.210 after its recent decline. US stock markets began the week positively, easing previous trade tensions with China. The Pi Network is showing signs of recovery, but its core team’s wallet activity could create supply pressure. **Weakness in Developed Economies** New Zealand’s retail sales ticked up to 1% year-over-year, but this isn’t a sign of strength. Instead, it highlights how high interest rates are hurting the economy. The Reserve Bank of New Zealand has kept its cash rate at 5.5% since mid-2023, which is affecting consumer spending. Weak consumer data in developed economies raises concerns about global growth as we approach the year’s end. This situation keeps the US dollar strong as a safe haven, similar to trends seen during the US-China trade disputes in the late 2010s. The Federal Reserve faces challenges as recent US inflation data remains above 3%, making it difficult to adjust policies. Derivative traders should prepare for the dollar to remain strong, especially against currencies from more dovish central banks. Historically, geopolitical tensions increase demand for precious metals, and today is no different. Ongoing supply chain shifts and competition among major powers create market uncertainty. This is a major reason gold prices have held steady above $2,350 per ounce throughout 2025. In the coming weeks, we recommend using options instead of taking outright positions. Implied volatility for major indices like the S&P 500 is rising, indicating that the market expects significant movements. Buying protective puts or creating put spreads can help manage risk against a potential economic slowdown. The Australian dollar is often seen as a reflection of sentiment about China, which is showing signs of slowing growth. Recent industrial production figures from China fell just short of expectations, impacting industrial metals and currencies tied to commodities. We suggest avoiding long positions in commodity futures until there are clearer signs of recovery in Chinese manufacturing. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now