The NFIB Business Optimism Index in the United States reached 100.3 in July, surpassing expectations of 98.6. This shows that small business owners are feeling positive and that the economic outlook is improving. The EUR/USD currency pair climbed to daily highs near 1.1650 after mixed US inflation data impacted the US Dollar. Similarly, the GBP/USD pair rose above the 1.3500 mark due to renewed downward pressure on the US Dollar.

Gold Nears Important Levels

Gold prices approached $3,350 per troy ounce after the release of US inflation data. This movement comes as global attention shifts to an upcoming meeting between Trump and Putin, along with potential further easing actions by the Federal Reserve. The Pi Network saw its value drop below $0.4000 after peaking at $0.4661. Technical indicators suggest a potential downward trend, with a possible 10% correction like the one seen in mid-July. The Bank of England cut interest rates by 25 basis points to 4%, indicating the end of the current easing phase may be near. Concerns remain about inflation, which is still above the targets set by policymakers.

US Economic Strength and Inflation Worries

The NFIB index at 100.3 shows strong confidence among small businesses, indicating strength in the US economy. This may support US stock indices, which have been stabilizing after hitting record highs earlier this summer. With the S&P 500 trading above 6,150, ongoing domestic optimism could push stock prices higher. This economic strength is complicated by recent inflation data, which has led to weakness in the US Dollar. The mixed July CPI report showed core inflation slightly decreased to 3.7%, but it remains above the Fed’s target. This suggests limited room for further interest rate hikes. We see this as a signal to prefer foreign currencies like the Euro and the Pound against the Dollar in the short term. In the UK, the Bank of England’s decision to lower its rate to 4% may be one of its final cuts. UK inflation remains stubbornly high at 5.2%, making further easing difficult for policymakers. This might lead to stability for the Pound, and we could witness increased volatility in GBP/USD options as the market contemplates the Bank’s next steps. Gold nearing the $3,350 mark reflects concerns about inflation and a weak Dollar. We view gold as a strong hedge against uncertainty, especially with the geopolitical tension from the upcoming Trump-Putin summit. This situation is reminiscent of the gold rally during the high-inflation period of the late 2020s, making bullish call option strategies on gold futures appealing. In the speculative digital asset markets, we are cautious about the Pi Network. Its failure to stay above $0.4600 and recent decline indicate a potential downtrend, similar to the significant correction seen in July 2025. Traders should be ready for another possible 10% drop and consider short-side opportunities if the token falls below key technical support. Create your live VT Markets account and start trading now.

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