The GBP/USD pair has risen to 1.3724, the highest point since January 2022. Currently, it trades around 1.3710, marking four consecutive days of gains. This rise is fueled by a fragile US-brokered ceasefire between Israel and Iran, which has boosted market sentiment. US President Donald Trump recently discussed possible meetings with Iran but questioned their necessity due to the damage done to Iran’s nuclear sites by US actions. The weakening of the US Dollar has also helped GBP/USD, which has seen strong gains, reaching its highest levels in four and a half years.

Central Banks and Market Activity

Market actions are influenced by statements from officials at the Bank of England and the Federal Reserve. Fed Chair Jerome Powell wrapped up his semi-annual testimony, emphasizing caution due to concerns about economic conditions affected by US tariffs. The ceasefire between Israel and Iran has created a positive market atmosphere, despite its unstable nature due to ongoing tensions. The GBP has gained for three straight days, staying above 1.3600, partly due to the Bank of England’s dovish signals. The GBP/USD pair moving above 1.3700 highlights how external factors can drive mid-term trends when combined with consistent messaging from central banks. The shaky peace in the Middle East has affected risk markets, raising demand for higher-beta currencies and decreasing USD demand. This response is typical during periods of geopolitical easing, even if risks linger. As traders build expectations of temporary regional stability, their actions reflect this outlook. Powell’s testimony concluded with a defensive tone. His reluctance to make aggressive moves led market participants to reduce their USD positions. Although no direct policy changes occurred, markets reflect less urgency from the Federal Reserve. This could lead to a shift in risk for dollar-denominated assets, particularly in derivatives, where rate-sensitive instruments have already begun diverging from previous pricing. We expect this trend to continue and potentially speed up if upcoming economic data doesn’t support a more assertive Federal Reserve stance.

Sterling and Market Trends

The recent rise in sterling isn’t just a reaction to events. Bailey’s earlier comments, while not distinctly dovish, encouraged a balance between patience and action, affecting interest rate expectations and supporting sterling flows. Trading volumes now indicate broader repositioning, with shorter GBP risks gaining preference as volatility expectations decrease. This upward momentum is not solely speculative; it connects to adjustments in both the FX spot and options markets. We believe the rise past 1.3700 indicates that earlier resistance levels are now less likely to impede further gains unless market sentiment shifts negatively. In the short term, there are not many significant economic reports anticipated that could disrupt this trend, unless weak data emerges from the UK or the ceasefire collapses. For those involved in derivatives trading, it’s important to monitor how volatility pricing shifts around upcoming expirations. As GBP/USD stabilizes at these levels, tightening skews show a reduced interest in downside protection, marking a change in sentiment. It’s essential to note that recent remarks from US and UK officials continue to hold significance. Tariff discussions in Washington and ongoing inflation pressures in Britain require traders to stay flexible. Despite their caution, monetary authorities are attentive to wage growth and service inflation. If these rise faster than expected, we could see a shift in rhetoric, potentially signaling earlier than anticipated changes. We may be entering a time where carry trades become more appealing. Foreign investments in sterling could keep increasing as long as the interest rate narrative remains steady. However, those with forward exposure should remain watchful for any new developments from Washington that could revive dollar demand. Staying reactive rather than predictive may provide better flexibility, especially with headlines affecting risk. Notably, current flows indicate that GBP strength is not facing strong resistance. This is not just technical momentum but a broader recalibration of positions, often signaling the start of longer-term trends. Call spreads for mid-July show rising interest, reflecting a more strategic approach rather than purely opportunistic. If this trend continues, upside plays may expand. Create your live VT Markets account and start trading now.

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European Central Bank Officials June 2025 Events

On June 26, 2025, several officials from the European Central Bank will speak at different events. Isabel Schnabel will join a panel discussion at the “Wirtschaftsrat der CDU” Finanzmarktklausur in Frankfurt, Germany, at 07:00 US Eastern time (11:00 GMT). Luis de Guindos will participate in the Deutsche Bank Forum 2025 virtually at 05:45 US Eastern time (09:45 GMT). Later in the day, Christine Lagarde will deliver the opening speech at the 150th Munich Opera Festival at 14:30 US Eastern time (18:30 GMT). While these events feature high-profile speakers, they likely won’t focus heavily on economic policies. Lagarde, known for drawing interest alongside Schnabel, might be limited in her ability to discuss economic matters because of the festival setting. The events throughout June 26 showcase key ECB officials, but they aren’t tied to formal monetary policy updates or press conferences. Schnabel’s participation in a financial panel suggests some monetary topics might come up, but insights will likely come from discussions rather than formal announcements. De Guindos’s virtual appearance is expected to be more controlled, leaving little room for unscripted comments. Given Lagarde’s cultural festival role, the scope for deep economic discussions is limited. The key takeaway for us is how the market interprets what is said—or not said. When central bank officials speak, even in non-financial settings, the market pays close attention to any shifts in tone. Schnabel often presents a hawkish view, so if she mentions inflation or policy challenges, it could influence market actions.

Market Interpretation And Strategy

It’s important to focus less on headlines and more on tone and framing. If the officials express caution or uncertainty, especially after the June policy meeting, we might start to see differing views among Council members that the market hasn’t yet anticipated. This situation requires a balance—avoiding speculative extremes while staying alert to shifts in sentiment. Interest rates depend on data, and the economy’s sensitivity to further tightening is starting to show in bond spreads and forward markets. Volatility in short-term rates has eased slightly in recent weeks following the May decisions, but some uncertainty remains as we approach September’s quarterly forecasts. The current calendar indicates we have some time before major commitments emerge, which usually invites tactical trading. Lower confidence trades might exit during quieter speech times, but volatility can quickly return if comments are misinterpreted. Looking two to four weeks ahead, many traders may instinctively pull back on duration or neutralize positions at the first sign of conflicting comments. This approach could be costly. Instead, it may be wiser to stay selective, focusing on short-term strategies where carry is positive and rate sensitivity is manageable. There’s little indication that policymakers plan to make drastic changes, but the risk lies in tone, not timing. Appearances that aren’t strictly technical can still influence ongoing narratives. De Guindos might address themes from previous comments about financial stability, which would be more relevant for longer-term instruments than near-term rate speculation. In past cycles, quieter periods have often led to curve adjustments rather than directional trading. We expect this trend to continue, especially as liquidity changes during the summer. Even without firm commitments, these speeches can provide important cues—especially when viewed collectively over a week. The consistency or contradictions between speakers is crucial. While Thursday’s events may not ignite immediate reactions, the following days could reveal if there is dissent or if policy remains consistent. A few carefully chosen words can shift implied volatility, so we should be prepared to adjust our strategies accordingly. Create your live VT Markets account and start trading now.

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Gold prices in India stayed stable on Thursday at 9,211.57 INR per gram, only slightly up from 9,203.14 INR the day before. The cost per tola remained steady as well at 107,441.90 INR, compared to 107,343.70 INR yesterday.

US Rate Cut Potential

The chance of a US rate cut is pushing the Dollar down, making Gold more appealing. Geopolitical issues, like tensions between Israel and Iran, are also keeping prices steady, as caution takes hold in the market. Traders are looking forward to new data releases and comments from the FOMC, which could affect Gold prices. Important indicators, such as the US Personal Consumption and Expenditure Price Index, will help guide future movements in the USD and Gold prices. Gold continues to be seen as a safe haven, with central banks increasing their reserves. Its price is influenced by its relationship with the US Dollar and interest rates—when the Dollar weakens, Gold prices often rise. In India, Gold prices are barely changing, indicating that the market is entering a quieter phase. Traders monitoring short-term shifts will note that prices around ₹9,211 per gram reflect a market in search of guidance rather than acting out of strength or weakness. The stable tola price further supports this sentiment. In the US, Powell has indicated that the Federal Reserve is taking a wait-and-see approach while assessing the effects of trade changes and tariffs. This is significant, especially given Trump’s frustrations, which have led to discussions about possible changes in Fed leadership. This isn’t just a headline; it suggests that stability may be more about noise than firm decisions. We’ve seen that even hints of rate cuts in the US can weaken the Dollar, which often boosts Gold prices. When currencies weaken, investors turn to Gold for safety. This is driving more interest in Gold, not because of its inherent strength but because it represents a trusted option. While tensions in the Middle East remain steady, they are keeping risk appetite low. This situation may not lead to significant upward price movements, but it helps prevent sharp declines. Market positioning has become more cautious, and volatility has decreased, implying that derivative traders should analyze order flow and implied volatility before adjusting their positions.

Upcoming Economic Data

Now, all eyes are on upcoming economic data. We are particularly interested in the PCE index from the US. This measure of inflation-adjusted spending is one of the Fed’s favored metrics and is likely to have more impact than market speculation. If personal expenditure data continues to indicate lower inflation, expectations for a rate cut will strengthen, making Gold—already benefiting from lower yield expectations—even more appealing. The relationship between the Dollar and Gold is crucial. Whenever rate cuts diminish the appeal of treasuries or cause capital to leave Dollar holdings, Gold can fill that void. This isn’t driven by incentives; it’s based on relationships. Countries like Russia and China, along with smaller central banks, are not accumulating Gold randomly—they are reacting to the same trends, where commodities provide a safer hold than exposed currencies. The key takeaway for us is about timing these market shifts, not just reacting to headlines. Economic data releases, rate decisions, and geopolitical developments all translate into price spikes or declines in volatility. Options traders might benefit from focusing on shorter-term expiries until the market direction becomes clearer. Currently, forward curves are in contango, indicating no urgent supply issues. However, rollover costs could impact long speculative positions. Keeping an eye on the variability across maturities will help shape better trading strategies. Being adaptable doesn’t mean being inactive. It means making fewer, more informed bets and anticipating changes in rate policy rather than waiting for confirmation. Create your live VT Markets account and start trading now.

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Dear Client,

As part of our commitment to provide the most reliable service to our clients, there will be maintenance this weekend.

Please note that the following aspects might be affected during the maintenance:
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2. The price quote and trading management will be temporarily disabled during the maintenance. You will not be able to open new positions, close open positions, or make any adjustments to the trades.

3. There might be a gap between the original price and the price after maintenance. The gaps between Pending Orders, Stop Loss, and Take Profit will be filled at the market price once the maintenance is completed. It is suggested that you manage the account properly.

The above data is for reference only. Please refer to the MT4 / MT5 / VT App for the specific maintenance completion and marketing opening time.

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The global economic recovery is facing unique challenges, as noted by China’s finance minister. This highlights the tough situations economies around the world are currently dealing with. Earlier, China’s Premier Li shared plans to boost spending. These efforts aim to enhance domestic demand and support economic growth amid worldwide difficulties. The finance minister has acknowledged that the current challenges are unusual and urgent for the overall recovery. This situation is not just a typical slowdown; what we are experiencing now includes factors that weren’t seen in previous recoveries. Supply chains are still disrupted in many sectors, capital flow is inconsistent, and business confidence, particularly among smaller companies, is still shaky. This suggests we need to look beyond just the main indicators. In response, Premier Li is focused on encouraging households and businesses to spend more. His priority is building internal momentum—aiming to increase domestic consumption through various fiscal measures and possibly changes in lending policies in the future. It’s significant that Beijing is focusing inward at a time when external demand isn’t as reliable as it used to be. For investors, the message is clearer than ever. When officials start actively shaping fiscal policies with purpose, early investors—especially those using options or structured leverage—should pay attention to which sectors benefit first. We’ve already seen consumer, retail, and local travel stocks lead the way after previous similar statements. Looking at past examples, we know these kinds of actions can provide a short-term boost to stocks and inflation expectations, especially in emerging markets. This suggests that short-term contracts tied to inflation or discretionary retail might see greater movements than usual. It’s important to monitor regional consumer sentiment, as it usually reacts ahead of or soon after formal stimulus plans. Additionally, since the challenges are considered unusual, it indicates that traditional tools may be employed at unexpected times. This environment makes risk assessment both more valuable and more unpredictable. Implied volatility may show erratic pricing for medium-term contracts, allowing for quick adjustments as new strategies arise from Beijing. Long-term yields suggest a cautious approach, so we should avoid committing to long-term positions. Flexibility is our best defense and opportunity right now since clarity is lacking while policy actions are being ramped up. Keep an eye on changes in language at upcoming regional policy briefings, as they often hint at significant actions to come.

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On Thursday, gold prices in Malaysia remained mostly stable. Gold was priced at 453.23 Malaysian Ringgit per gram, a slight increase from 452.80 MYR the day before. The price of gold per tola stood at 5,286.39 MYR, up just a bit from Wednesday’s 5,281.36 MYR. For other measures, 10 grams of gold cost 4,532.30 MYR, and a troy ounce was priced at 14,097.07 MYR.

How Gold Prices Are Determined

Gold prices in Malaysia are based on international rates converted into local currency and updated each day. These prices serve as a general guideline and may vary from local rates. Gold has long been considered a safe investment, protecting against inflation and economic difficulties. Central banks, especially in emerging countries, hold significant amounts of gold, adding 1,136 tonnes to their reserves in 2022. Generally, gold’s value increases when the US Dollar weakens or during uncertain geopolitical situations. The price of gold usually goes up when the US Dollar drops, as they have an inverse relationship. Gold doesn’t generate interest, making it sensitive to interest rates—its value tends to rise when rates are lower.

Examining Current Gold Prices

The slight changes in gold prices in Malaysia do not signal immediate concern or excitement. With the price at 453.23 MYR per gram, just 0.43 MYR higher than the previous day, there is no significant movement in the charts. The prices for tola and troy ounce reflect the same pattern—stable without declines. What does this mean for us? Let’s look at the bigger picture. Gold pricing in Malaysia is influenced by global markets, meaning our local prices translate international trends through currency exchanges. The steady prices indicate a lack of strong buying or selling pressure worldwide. Interestingly, this stability comes even as traditional factors supporting gold—like political instability and a weaker dollar—are present. Gold generally gains when the US Dollar declines or during times of market uncertainty, as investors turn to it for reliability, despite the lack of interest it pays. The fact that central banks purchased over 1,100 tonnes of gold in 2022 is significant. Countries, especially emerging economies, are making these purchases due to currency worries and economic challenges. This consistent action shows a careful approach. Looking at the lack of price movement suggests short-term speculation isn’t the best strategy right now. Many investors are watching interest rate trends. Higher interest rates usually divert investors from gold since they can find better returns elsewhere. However, with no recent surprises in rates, gold remains neutral—it isn’t being either heavily favored or punished. This might just be a waiting period. For us, it’s less about making immediate moves and more about being prepared. Focus on positioning for market changes rather than chasing small daily fluctuations. Options on gold or gold-linked ETFs may gain appeal if interest rates start shifting or if the next US inflation report alters expectations. Those dealing with derivatives should evaluate their exposure to gold trends that are stable. Be cautious of losses from sideways price movements; strategies like straddles or strangles may lose value without fresh momentum. Instead, practice patience, expand your watchlists, and stay alert for any developments that could trigger the next movement. Noticing what’s missing is just as important as acting on what’s available. Create your live VT Markets account and start trading now.

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China’s Premier Li believes the country’s economy shows strong resilience and great potential for growth. Recent economic data from the second quarter shows stability, and the government is working to encourage consumption. Li stated that China’s ongoing economic development will provide opportunities for other countries, as China continues to be a key player in the global economy.

Transitioning To A Consumer Market

China plans to shift from being mainly a manufacturing hub to a large consumer market. This move aims to support continuous growth and extend economic influence around the world. Li’s message is clear: China is not only stable but is also ready to grow from within. His optimism reflects the recent Q2 data, which shows stability without drastic ups or downs. In simple terms, it means the economy is stable for now, indicating no imminent drop in demand or sudden policy changes. When Li talks about China becoming a consumer-driven economy, he is providing a long-term vision. The change won’t happen overnight, but it’s being set in motion. For us, this highlights the importance of upcoming retail sales, service activity, and income reports—they will reveal if the rest of the country supports this vision. There is still expected policy support. Although bold new stimulus plans aren’t visible right now, recent guidance suggests that consumer spending will be encouraged more than before. This reduces the chances of sudden shocks that might disrupt market pricing. Combining steady production with gradual domestic growth tends to stabilize inflation expectations, especially when paired with controlled currency policies.

Trade Resilience And Market Strategy

Zhou from the finance ministry stated that trade resilience will be maintained, emphasizing durability and gradual improvement. For traders tracking rate differences, growth in net exports combined with capital inflows could bolster currency strength or at least reduce potential risks from valuation gaps. Our strategy is to focus on these signals and position ourselves accordingly, rather than anticipating them too early. Short-term derivatives on Chinese assets may show less volatility if this trend continues, yet any bets should be guided by future consumption indicators rather than past industrial data. With that said, we are closely monitoring upcoming data, especially any indicators that could reveal a gap between consumption expectations and actual earnings. If such a gap emerges, it may create opportunities to make strategic moves before the general consensus aligns. When consumption rises alongside stable exports, we often see a tighter alignment in multi-asset spreads. Rebalancing around these shifts could allow for gradual adjustments in exposure rather than abrupt changes. The real opportunity lies not in past performance but in future pursuits. As long as growth stories are backed by real consumption rather than just investment, it mitigates potential downturns in product-related derivatives across Shanghai and Hong Kong indexes. While it doesn’t completely eliminate risks, it does make them easier to measure. Create your live VT Markets account and start trading now.

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GBP/USD reached 1.3724, the highest point since January 2022. This rise comes after a US-brokered ceasefire between Israel and Iran improved market confidence. Jerome Powell, the Federal Reserve chair, cautioned about the inflation risks linked to Trump’s tariffs, highlighting the need for careful decisions on interest rate cuts. Donald Trump mentioned future talks with Iran but doubted the effectiveness of diplomatic efforts concerning its nuclear program. Speculation is growing as Trump considers candidates to replace Powell, with Kevin Warsh and Kevin Hassett as frontrunners. In the UK, Bank of England Governor Andrew Bailey noted a weakening labor market and potential impacts on wage growth. He also raised concerns about rising social security contributions, which may contribute to economic inactivity.

The Pound Sterling

The Pound Sterling is a major currency, involved in 12% of global transactions. Its value mainly reflects the Bank of England’s monetary policies aimed at keeping inflation steady. Economic indicators like GDP and employment can affect GBP’s worth, with a strong economy enhancing its value. Trade balances also matter—positive balances can strengthen the currency due to increased demand for exports. With GBP/USD hitting 1.3724, the highest level since January 2022, the trend is influenced by geopolitical changes and monetary signals. This surge comes after a temporary reduction in Middle Eastern tensions, soothing market nerves. Improved risk sentiment propelled the Pound upwards. In the US, Powell noted that inflation pressures could rise if trade policies become less open again. This raises concerns that rate cuts might arrive slower than anticipated. However, he maintained a measured tone, indicating that any policy shift will depend on economic data rather than politics. Trump’s comments stirred debate. He raised questions about diplomatic engagement with Iran, signaling uncertainty about upcoming talks regarding its nuclear ambitions. He hints at a desire to reshape US diplomacy and central banking. The potential replacement of Powell is a hot topic, with Warsh and Hassett known for favoring tighter monetary policy, which would contrast sharply with current practices.

Changes in Leadership

For those monitoring long-term investments, Powell’s possible departure adds a level of uncertainty. A new leader could change communication styles and inflation tolerance, quickly impacting the rate curve. In the UK, Bailey’s observations deserve more scrutiny. He acknowledged that the labor market is weakening—employment growth is slowing, and wage growth is lagging behind previous months. His mention of rising national insurance contributions highlights a growing concern: many individuals are not participating in the workforce, not due to unemployment, but by choice. These structural challenges are presently more significant than general inflation. For British assets, how the Bank of England responds to changes in workforce participation and wage growth is becoming more important than simplistic inflation measures. Slower wage growth makes it harder for the Monetary Policy Committee to justify maintaining high interest rates for a long time. Market watchers should closely analyze the next employment report, especially data on inactivity and hours worked. These metrics will indicate whether the Bank will cut rates or hold steady. This week’s currency movements suggest a market leaning in one direction. We advise caution in assuming that simple rate differences will continue to determine GBP/USD. While the Pound benefits from global transaction flows as a reserve currency, its immediate direction is likely shaped more by domestic policy nuances than broader currency trends. With global events easing panic selling and opening risk trades, the key question is whether this positive sentiment can last. The combination of uncertainty around US policy and minor softening from the UK central bank creates a wide range of possible outcomes. Every data release and speech now carries greater significance than it did a few weeks ago. For traders, implied volatility might underestimate what is coming next. Create your live VT Markets account and start trading now.

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Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

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The People’s Bank of China (PBOC) controls the daily value of the yuan using a managed floating exchange rate system. The yuan can vary within a +/- 2% range from this central rate. The yuan closed at 7.1750 yesterday. Recently, the PBOC injected 509.3 billion yuan through 7-day reverse repos while keeping the interest rate at 1.40%. Today, 203.5 billion yuan is maturing, leading to a net injection of 305.8 billion yuan. This shows the central bank’s plan to manage liquidity and stabilize the currency market. By injecting 305.8 billion yuan, the central bank is doing two things. They’re providing short-term funds and signaling to the markets that they want to avoid too much tightening of liquidity. The interest rate remains at 1.40%, which means there’s no rush to change monetary policy right now. This stability, even with some maturities, indicates a desire to keep financial conditions positive. The reference rate is close to 7.17, near the weaker end of the allowed range. This can put pressure on outflows of capital. With the dollar gaining strength against other major currencies, the PBOC is being cautious with rate management. Fang’s team likely views this as a way to prevent the yuan from weakening too quickly, especially as capital movement faces more scrutiny. It’s important to understand that reverse repos do more than just add cash—they help manage expectations. When large cash injections coincide with maturity dates, the signal becomes clearer. Deng’s team may see these actions as establishing a baseline, rather than starting new cycles. This distinction matters if there’s renewed volatility in currency futures. Policymakers aim to keep exchange rates disciplined while ensuring ample liquidity, which means funding conditions should remain gentle. This reduces the need for drastic adjustments unless unexpected external data forces a change. In the short term, we might see wider gaps between offshore and onshore yuan rates, especially if traders like Li start considering dollar-related news from Washington. For now, the PBOC’s actions suggest a cautious effort to protect against market swings while avoiding speculation. From our perspective, the steady 1.40% interest rate indicates that we’re not expecting any changes soon. Soft money, predictable ranges, and planned reserve operations signal a preference for stability. Overall, these measures support funding rates and maintain a steady currency bias for the time being.

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