Dear Client,

As part of our commitment to providing the most reliable service to our clients, VT Markets will have the following adjustment of CopyTrading (Vtrade) service on 8th March 2025:

1. “Management fee” will be removed from the Offer’s Performance setting.

The adjustments are intended to enhance our server quality and provide you with an improved trading environment. Thank you for your understanding about this important initiative.

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J.P. Morgan predicts that gold prices may reach nearly $3,000 per ounce by the end of 2025, reflecting a long-term positive perspective on the metal.

This forecast is based on ongoing demand for gold as a safeguard against inflation and geopolitical instability, alongside potential changes in global monetary policy.

Central Bank Influence On Gold

With central banks boosting their gold reserves and market conditions supporting high demand, J.P. Morgan foresees a continued upward trend in gold prices.

This projection highlights the expectation that gold will remain in demand as investors look for stability amidst economic uncertainties. Inflationary pressures, alongside shifts in global monetary strategies, serve as key reasons behind such an outlook. When central banks accumulate gold reserves at an increasing pace, it signals confidence in the metal’s long-term role as a store of value.

We have already seen a broader movement towards gold acquisition, particularly from institutions aiming to balance their reserves amid concerns over currency fluctuations. That pattern has not only persisted but appears reinforced by ongoing economic tensions in numerous regions. With policymakers adapting to structural changes in financial markets, the likelihood of further adjustments to interest rates directly impacts market sentiment surrounding metals.

This directly affects futures markets, where positions taken on gold anticipate both policy decisions and macroeconomic shifts. Higher expected prices offer traders opportunities, but they also suggest a need for careful positioning. Those tracking gold-related instruments should factor in the controlled expansion of central bank reserves and how currency stability may shift in response.

Geopolitical Factors And Market Sentiment

Meanwhile, geopolitical events continue to support wider interest in assets less vulnerable to external shocks. Periods of uncertainty tend to amplify investor preference for options that hold value independently of national policies. With this in mind, market participants must observe not only price movements but also institutional strategies shaping global reserve allocations.

We remain focused on how these trends interact with liquidity conditions, especially as financial institutions assess their exposure. The current outlook suggests growing market confidence in gold’s role, making it essential to monitor developments in fiscal planning that could either reinforce or challenge this trajectory.

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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 US Dollar has gained momentum due to fears that tariffs could increase inflation and push the Federal Reserve to maintain higher interest rates. Technical indicators suggest the pair is poised for further gains, with potential resistance around 1.4545 and 1.4600.

Key Support And Resistance Levels

Conversely, if it falls below the 1.4470 area, the pair may attract buyers near 1.4400, while further selling pressure could lead to a drop towards 1.4300. The Canadian Dollar is influenced by interest rates, oil prices, and economic data, which all impact its valuation.

The stability of USD/CAD near 1.4500 shows that broader market forces are at play, particularly the downward movement in oil prices. With oil being such an important export for Canada, declines in its value tend to weaken the country’s currency. The added concerns over trade relations with the United States only add to the pressure. Meanwhile, the US Dollar has gathered strength, largely because of worries that potential tariff adjustments could drive inflation higher. If that scenario develops, the Federal Reserve may have little choice but to hold rates steady at restrictive levels for longer than markets initially expected.

From a technical standpoint, the pair remains positioned for possible upside movement. Resistance levels at 1.4545 and 1.4600 appear to be the next points of focus if upward momentum continues. However, if buyers fail to push beyond current levels, setbacks could emerge. A dip below 1.4470 might bring in renewed interest around 1.4400, while a more sustained decline could bring 1.4300 into play. Given how dependent the Canadian currency is on multiple factors—particularly interest rate differentials, commodity prices, and macroeconomic releases—any shifts in these areas may provide new trading opportunities.

Market Factors To Watch

For those engaged in derivatives trading, the current climate calls for close attention to central bank communication, as small shifts in language from policymakers could provide clarity on monetary policy intentions. Additionally, developments in the oil market must be monitored carefully, as further declines could intensify pressure on the Canadian Dollar. Volatility could arise should new trade measures come into force, especially if they alter inflation expectations and influence interest rate bets. With multiple forces in motion, short-term positioning may benefit from flexibility, as sudden changes in sentiment may shape price movements in the coming weeks.

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China’s Commerce Ministry has expressed strong opposition to the United States implementing a 10% tariff on Chinese imports effective from March 4.

The ministry plans to take necessary countermeasures to protect China’s legitimate rights and interests, asserting that the US has ignored facts and international trade rules.

The spokesperson labelled the US actions as a clear example of unilateralism and coercion.

Rising Trade Tensions

This direct rebuke from Beijing underscores the rising friction between the world’s two largest economies. When tariffs like these are introduced, they rarely exist in isolation. Retaliatory measures tend to follow, and that can introduce fresh concerns across financial markets.

Washington’s decision to impose additional duties on Chinese goods affects more than just diplomatic relations. Supply chains feel the weight of higher costs, businesses reconsider sourcing strategies, and price pressures may filter down to consumers. Policymakers in Beijing will not let such a move pass without response. If past patterns hold, countermeasures will likely mirror the approach taken in prior disputes—perhaps through targeted tariffs on US exports or stricter regulatory scrutiny on American firms operating within China.

From an economic standpoint, these latest developments add another layer of complexity to an already fragile global trade climate. Traders should consider how Beijing’s reaction could affect multiple asset classes. When major economies engage in such disputes, equities, currencies, and commodities tend to reflect the uncertainty. Previous tariff escalations have had clear effects on market sentiment. Sudden shifts in risk appetite have led to increased volatility, and that may repeat in the weeks ahead.

Currency markets, in particular, could see sharp moves. In past confrontations of this nature, the yuan has often come under pressure. Authorities in Beijing manage the currency closely, but prolonged trade disputes have previously led to depreciation trends. If that pattern resumes, related assets may experience follow-through effects. Similarly, adjustments in capital flows could impact broader liquidity conditions.

Equities tied to trade-sensitive sectors should not be overlooked either. Manufacturing, technology, and consumer goods tend to be at the forefront during such tensions. If fresh tariffs push production costs higher, earnings forecasts may need recalibration. That recalibration can fuel further market adjustments, particularly in companies with considerable exposure to US-China trade.

Beijing’s Strategic Response

The stance taken by Beijing leaves little ambiguity. Officials have framed this as a direct challenge to fair trade principles. If the past serves as any indication, the next steps may not be limited to matching tariffs alone. Broader policy tools remain at their disposal, whether through adjustments in import policies, regulatory pressures, or incentives aimed at reducing reliance on US goods.

Historical precedents should guide expectations. The last time tariffs were raised at this level, markets moved swiftly, and uncertainty deepened before any resolution emerged. Those with exposure to affected sectors should reassess positioning with that in mind. Reaction time matters in environments like this, particularly when policy decisions can come with little warning.

As Beijing prepares its response, ripple effects may extend well beyond direct trade channels. The interconnected nature of modern global markets means that decisions taken in one capital are rarely contained there. Investors must weigh not just the immediate tariff impact, but also how expectations of prolonged tensions could shape broader positioning. Until there is clarity on countermeasures, reactive market movements could become more frequent.

The coming weeks will offer more concrete signals of Beijing’s strategy. If prior disputes are any guide, announcements may arrive abruptly. Policymakers have little incentive to telegraph their full response in advance. Those watching developments should prepare for rapid shifts, particularly in asset classes sensitive to trade policy news.

Trade frictions of this scale have rarely been resolved quickly, and this time appears no different. With retaliatory steps on the horizon, near-term adjustments in supply chains and financial markets should not be dismissed. Reaction speed, adaptability, and thorough monitoring will be essential.

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Gold prices in Saudi Arabia remained steady on Tuesday, with the cost per gram recorded at 348.47 Saudi Riyals (SAR), slightly down from 348.55 SAR the previous day. The price for a tola was 4,064.41 SAR, compared to 4,065.43 SAR on Monday.

Current gold prices are as follows: 1 gram at 348.47 SAR, 10 grams at 3,484.64 SAR, a tola at 4,064.41 SAR, and a troy ounce at 10,838.78 SAR. Prices are adjusted daily, reflecting international market trends in USD/SAR.

Central Banks And Gold Reserves

Central banks play a major role in gold demand, having added 1,136 tonnes to their reserves in 2022, amounting to about $70 billion. This marks the largest annual purchase recorded, with countries like China, India, and Turkey increasing their holdings.

Factors influencing gold prices include geopolitical instability and interest rates, with demand rising in uncertain times. The performance of the US Dollar also significantly affects gold pricing, as a weak dollar tends to increase gold values.

Gold appears to be holding its ground in Saudi Arabia, with only minor fluctuations since the start of the week. A gram is currently priced at 348.47 SAR, reflecting a marginal dip from the previous day’s 348.55 SAR. For those tracking larger quantities, the cost of a tola stands at 4,064.41 SAR, while a troy ounce is now 10,838.78 SAR. These daily price changes stem from shifts in the broader market, particularly movements in the USD/SAR exchange rate.

The buying patterns of central banks have been reinforcing gold’s role as a store of value. In 2022, purchases totalled an immense 1,136 tonnes—a record-breaking accumulation worth roughly $70 billion. That scale of acquisition signals deeper confidence in gold as a hedge, particularly from nations such as China, India, and Turkey, all of which expanded reserves.

Key Factors Affecting Gold Prices

Several key elements contribute to how gold is priced, and among them, geopolitical tensions and interest rate decisions are often the most influential. When uncertainty rises, demand for gold follows suit. Another factor that cannot be ignored is the performance of the US Dollar; when it weakens, gold tends to become more attractive. Given the current conditions, these aspects will remain the primary forces shaping market direction in the short term.

Looking ahead, those engaged in trading strategies that hinge on price movements should remain attentive to shifts in central bank policies and economic data that might impact currency strength. Market conditions can change quickly, and gold’s sensitivity to financial developments means that broad trends, rather than short-term volatility, will determine the next move.

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British retailers anticipate price increases in the coming months due to rising employment costs effective from April, according to the British Retail Consortium (BRC). In February, shop prices increased by 0.4% from January, reversing a previous decline, though they remained 0.7% lower compared to the previous year.

Rising operational costs, including a nearly 7% hike in the minimum wage and higher payroll taxes, may further elevate prices. Inflation stood at 3.0% in January, with predictions of 3.7% by Q3, raising concerns about the impact on consumer prices.

Impact On Food Inflation

Food inflation reached 2.1% in February, particularly affecting staples like butter and bread. The BRC forecasts food inflation might surpass 4% by mid-year, urging government intervention to mitigate the cost burden on retailers.

The data suggests inflationary pressures on retailers will not ease anytime soon. A 0.4% uptick in shop prices last month signals a shift from prior declines, marking a shift worth paying attention to. Despite year-on-year prices remaining lower, the recent reversal hints at upstream cost pressures feeding through.

Wage increases of nearly 7% and heightened payroll taxes make it increasingly difficult for businesses to absorb costs. These pressures likely explain why the BRC anticipates more price rises. When considering inflation already at 3.0% in January, and some expectations forecasting it hitting 3.7% by the third quarter, the knock-on effects across different sectors should not be underestimated. If these projections hold, the strain on household budgets will grow, affecting both consumer spending patterns and broader market sentiment.

Food prices tell a particularly direct story. February’s 2.1% year-on-year increase highlights mounting costs for basic goods, stretching household incomes further. Butter and bread, staples in nearly every household, seeing sharper increases suggests supply chains are already feeling strain. If, as the BRC warns, food inflation surpasses 4% by mid-year, discussions around policy responses will become more urgent.

Economic Policy Considerations

For market participants analysing short-term movements, these developments might offer insights into future pricing behaviours. Anticipating adjustments ahead of expected cost rises could help in assessing exposure. Policymakers will be in the spotlight should price pressures intensify, especially if government responses remain slow. Cost mitigation strategies by retailers could influence market expectations as businesses adjust strategies in response to these pressures.

The wider economic discussion remains tied to the government’s approach. Calls for intervention suggest retailers see external relief as necessary, with wage policies and tax burdens limiting their room to manoeuvre. If no policy adjustments materialise in the coming months, businesses may have little choice but to continue passing costs onto consumers. This raises questions about spending resilience, particularly as inflation forecasts indicate more strain to come.

Those assessing pricing trends in the short term will need to weigh these various elements carefully. Labour costs, inflation forecasts, and food pricing pressures all point towards an environment where price trends may not stabilise soon. Tracking both price adjustments and official responses in the coming weeks could offer insight into how these pressures are handled.

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EUR/JPY fell to around 156.25, experiencing a decline of 0.24% amid increasing safe-haven demand due to trade tensions linked to US tariffs. The Japanese Yen strengthened as concerns over potential economic slowdown in the US raised expectations for more interest rate cuts by the Federal Reserve.

The Bank of Japan is anticipated to increase interest rates, benefiting from improving economic indicators and wage growth. Conversely, the European Central Bank is expected to cut its Deposit Facility Rate by 25 basis points to 2.5%, influenced by consumer price inflation dropping to 2.4% from 2.5% in February.

Market Adjustments And Interest Rate Expectations

This movement in EUR/JPY reflects how traders are adjusting positions in response to broader shifts in interest rate expectations and economic signals. A stronger Yen suggests that market participants are seeking stability amid concerns that the US economy may slow down. That expectation has increased the likelihood of further interest rate reductions by the Federal Reserve, which has made lower-yielding currencies like the Japanese Yen more appealing.

On the Japanese side, recent domestic economic improvements and wage growth have allowed policymakers to consider shifting away from extremely low interest rates. If the Bank of Japan moves ahead with an interest rate hike, borrowing costs in Japan will rise, making the Yen even more attractive to investors looking for higher returns than before. That would add further pressure on EUR/JPY, potentially limiting any rallies unless other developments shift sentiment.

Meanwhile, the European Central Bank appears to be heading in the opposite direction. Inflation data suggests that price pressures are easing, and policymakers are likely to prioritise economic support by bringing interest rates lower. The expected rate cut to 2.5% reflects that. If the ECB follows through, the Euro could become less appealing compared to currencies backed by expectations of tighter monetary policy.

Managing Risk Amid Volatility

Looking ahead, traders must assess how these diverging central bank policies will affect price movements. If the Federal Reserve’s policy outlook shifts again—either due to changing economic data or new geopolitical risks—then the Yen’s current strength could become even more pronounced. On the other hand, if inflation in the Eurozone remains steady or rebounds slightly, the ECB may reconsider the pace of its rate cuts, which could provide the Euro with some support.

For those navigating derivatives linked to these currencies, managing risk will be extremely important. The next few weeks could bring heightened volatility, driven by economic reports, central bank communications, and shifts in expectations for interest rates. Being ready to adjust to new information will be essential.

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Australian retail sales experienced a 0.3% rise in January, reflecting an uptick in consumer spending following easing inflation and tax cuts. This rebound follows a 0.1% decline in December and aligns with analysts’ expectations, according to the Australian Bureau of Statistics (ABS).

Year-on-year, retail sales increased by 3.8%, with food-related spending identified as a primary contributor to the January growth. The data indicates that consumer demand remains strong, although broader economic conditions and potential interest rate changes may affect future spending behaviours.

Consumer Response To Economic Conditions

This increase in retail sales suggests that consumers are responding to improved financial conditions, with inflationary pressures softening and disposable income receiving a boost from tax adjustments. A rebound after December’s contraction signals resilience in household expenditure, a key factor in short-term economic activity. The 3.8% annual growth further reinforces this, particularly with food-related purchases driving much of the expansion.

Spending patterns matter because they influence expectations around monetary policy. Strong consumer demand can give policymakers reason to maintain, or even tighten, monetary settings if inflation risks persist. Conversely, any indications that this uplift is temporary—perhaps driven by seasonal factors or policy-driven fiscal relief—could temper such concerns. While January’s figures point to confidence among buyers, central bank officials will likely need additional data before considering adjustments to interest rates.

If the momentum behind higher spending continues, the effect on inflation must be weighed carefully. Price stability remains a priority, and any emergence of renewed inflationary trends could prompt a response. However, if this is merely a short-term adjustment following December’s decline, the broader impact on policy expectations may be limited. Watching upcoming data releases, particularly those tracking discretionary purchases versus necessities, will provide greater clarity on whether this shift is sustained.

Retail Trends And Economic Outlook

Although the overall increase aligns with forecasts, the composition of the sales growth matters just as much as the figure itself. A scenario where consumers are putting more of their income towards essentials rather than discretionary items could hint at underlying caution. The balance between needs and wants in purchasing decisions holds implications beyond just household sentiment—it affects retail performance, supply chain expectations, and broader market outlooks.

Future figures must confirm whether this January increase is part of a lasting trend or merely a temporary recovery. Should February data indicate continued expansion, discussions around interest rate policy could intensify. If instead a slowdown appears, confidence in broader economic strength may come under question. In either case, staying ahead of these changes requires ongoing assessment of not only the raw numbers but also the underlying behaviour driving them.

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In February, Japan’s Consumer Confidence Index was reported at 35, falling short of expectations, which were set at 35.7. This indicates a decline in consumer sentiment in the country.

Such statistics reflect the prevailing economic climate and consumer behaviour. A value below the expected level could suggest concerns regarding economic stability and overall financial health among the population.

Consumer Spending Impact

This shortfall in confidence reveals a sense of caution among consumers, which could have broader effects on spending patterns. When people feel less optimistic about their financial future, they tend to curb discretionary spending. This, in turn, may create ripple effects across the economy, particularly in retail, services, and other sectors reliant on household expenditure.

We must also consider how inflation and monetary policy decisions could be influencing sentiment. If living costs continue to rise while wage growth remains sluggish, confidence is unlikely to improve in the short term. On the other hand, if inflationary pressures ease or policymakers introduce supportive measures, the situation could shift.

From a trading perspective, weaker confidence figures often translate into lower demand expectations for certain assets. With consumers tightening their budgets, industries such as luxury goods and travel may face slower growth, while defensive sectors like utilities and staple goods tend to hold steady.

Market And Policy Reactions

Beyond immediate market reactions, central bank policy will play a role in shaping outlooks. If confidence figures continue to disappoint, discussions around interest rates may take on a different tone. Traders who focus on derivatives must watch for any indications of a changing stance from policymakers. Whether they maintain existing policies or adjust them in response to economic concerns will influence pricing in multiple asset classes.

As we monitor upcoming data releases, shifts in sentiment will provide insight into potential opportunities and risks. The next consumer confidence report and inflation updates will be key points of reference in assessing whether this is a temporary dip or part of a broader trend.

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