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Revised Q2 Eurozone GDP stays at +0.1% quarterly and +1.4% annually, unchanged from preliminary figures.
The Eurozone’s GDP for the second quarter of 2025 remained the same as the initial estimate, showing a quarterly growth of 0.1%.
When compared to the same period last year, GDP grew by 1.4%, matching the first report.
Fed policymakers hesitate on September rate cuts despite market pressures and uncertain data
Federal Reserve policymakers are still unsure about a possible rate cut in September. While traders mostly hope for this change, Fed officials are hesitant.
Kansas City Fed President Schmid and Chicago Fed President Goolsbee both doubt a rate cut will happen in September. However, Goolsbee remains open to different options as new information comes in.
Diverging Views
Non-voting members of the Fed, like Richmond Fed President Barkin and Atlanta Fed President Bostic, also share uncertainty. Barkin pointed out that the balance between inflation and unemployment is unclear, while Bostic mentioned that the bank prefers to wait for more data before making any policy changes. Fed governor nominee Miran downplayed the impact of tariffs on inflation as shown in CPI reports. Meanwhile, Bullard cautioned that making a large rate cut might seem “panicky.” Fed policymakers are being careful not to go against market expectations. This week, important U.S. economic data will be released, including PPI, jobless claims, and retail sales. With little time before the Jackson Hole symposium and the upcoming labor report, the Fed has few chances to influence market expectations. The FOMC blackout period starts on September 6, with a policy decision set for September 17.Market vs Fed Dynamics
Today, St. Louis Fed President Musalem and Richmond Fed President Barkin will speak, possibly offering more insights. As of August 14, 2025, there’s a noticeable gap between market hopes and Fed announcements. Fed funds futures estimate an 85% chance of a 25 basis point cut on September 17. However, officials like Schmid and Goolsbee show clear uncertainty. This difference between market belief and Fed signals often leads to volatility in the coming weeks. Market optimism is currently driven by the July CPI report, which showed inflation easing to 3.1%. However, the labor market remains strong, with the last jobs report indicating 190,000 new jobs and weekly jobless claims steady at around 225,000. This allows policymakers like Bostic to state they can “wait” for more information before taking action. For derivative traders, seeking volatility may be appealing. The VIX index is currently low at about 14, suggesting that options pricing may underestimate the potential for significant market shifts after key announcements. If the Fed decides not to change rates or cuts more than expected, it could lead to major adjustments across asset classes. The upcoming highlights to watch are the Jackson Hole symposium later this month and the jobs report on September 5. These events represent the Fed’s last chances to direct market expectations before their pre-meeting blackout begins. Any notable changes in the data could compel the Fed to take decisive action and resolve the current uncertainty. A similar situation occurred in late 2018, when the Fed adopted a cautious approach before making significant changes in early 2019 as market conditions changed. Although past events don’t repeat exactly, they indicate that ongoing market pressure can influence policy decisions. The Fed’s current hesitance may just be temporary before they align with market expectations. As a result, strategies like long straddles or strangles on major indexes, which profit from large moves in either direction, might be wise to consider ahead of the September FOMC meeting. Traders may also explore calendar spreads to capitalize on the expected volatility spike surrounding early September data. This allows traders to position themselves for the belief that current calm states won’t continue. Create your live VT Markets account and start trading now.Daly questions the need for a significant interest rate reduction next month
The Federal Reserve’s Daly stated that a big rate cut next month doesn’t seem necessary. She raised concerns that such a cut could wrongly suggest the labor market is weak.
Daly prefers a gradual shift to a more neutral interest rate over the coming year. She noted that there’s no need to rush changes based on current data.
Steady Approach Over Quick Shift
This suggests a steady approach instead of a quick change in monetary policy. Current data does not support a significant rate cut right now. It looks like a 50 basis point cut for September is unlikely. Previously, markets, including the CME FedWatch tool, thought there was almost a 40% chance of such an aggressive move. This shows that the Federal Reserve doesn’t feel the need to take bold actions. Honestly, the economic data does not call for panic. July’s job report added a solid 195,000 jobs, keeping unemployment at 3.8%. With the latest core inflation at 2.4%, the figures don’t suggest an urgent need for action. This points to a strategy of selling volatility in the weeks ahead. A “gradual” approach signals the Fed’s plans, reducing market uncertainty and large price swings. This situation is very different from the unpredictable market fluctuations we witnessed in 2022 and 2023.Reevaluating Positions In Light Of Cautious Reality
Traders should rethink positions that expected major cuts. The focus will likely move to pricing in a standard 25 basis point cut in September, or possibly a pause. We can expect changes in Fed Funds futures and options on SOFR to reflect this more cautious outlook. For equity options, this perspective makes a strong case for limited upside moves due to aggressive easing. Strategies that work well in a steady, mild market rather than a volatile one are more suitable now. We believe a slow and steady policy path offers a solid foundation for the market. Create your live VT Markets account and start trading now.Dividend Adjustment Notice – Aug 14 ,2025
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.
If you’d like more information, please don’t hesitate to contact [email protected].
The dollar faces pressure as the market anticipates rate cuts, while NZD/USD trends upward toward resistance
The NZDUSD has climbed to new highs after a US CPI report was released. The US dollar is under more pressure as the data matched forecasts, causing markets to anticipate an interest rate cut in September.
The chance of an easing has risen to 60 basis points by the end of the year, up from 57 basis points before the CPI report. Market confidence for a September cut is increasing, with expectations for at least one more cut by year-end. However, a strong NFP report in September could change these expectations. Additionally, August features Fed Chair Powell’s speech at Jackson Hole, which may also impact market views.
NZD Overview
The NZD is holding steady, with no major data changes except for a labor market report in line with expectations. Markets are forecasting a 42 basis point easing by year-end, with a 94% chance of a cut in the next meeting. On the daily chart, NZDUSD gains have paused near a trendline at 0.60. A rally might encourage sellers, who could target a drop to the 0.5850 support level. On the 4-hour chart, an upward trendline shows bullish momentum, with buyers preparing for a rally and sellers eyeing a drop. The 1-hour chart indicates resistance at 0.5965, where sellers aim for a downward move and buyers seek a rally. Upcoming US data includes PPI, Jobless Claims, Retail Sales, and Consumer Sentiment reports. The date today is 2025-08-14T08:59:47.786Z.Fed Interest Rate Expectations
The US dollar is weakening as we expect the Federal Reserve to cut interest rates soon. The recent Consumer Price Index report from July 2025 showed inflation at 3.1%, indicating that inflation is cooling, which supports this expectation. This has pushed the NZDUSD pair higher, though it is now facing some resistance. Markets are pricing in a 90% chance of a rate cut at the Fed’s September meeting, with futures suggesting 60 basis points of cuts by year-end. This follows a jobs report that showed only 170,000 jobs were added in July 2025, which gives the Fed more room to ease policy. Attention is now on Fed Chair Powell’s upcoming speech at the Jackson Hole symposium for any changes in tone. However, the New Zealand dollar has its own challenges, as the Reserve Bank of New Zealand is also expected to cut rates. With the RBNZ’s Official Cash Rate at 5.50%, markets expect nearly two full rate cuts by the end of the year. This dovish outlook from both central banks is capping the currency pair. Given the resistance near the 0.6000 level, traders might consider buying NZDUSD call options with strike prices just above this key trendline. This strategy allows for limited risk while aiming to profit from a potential breakout if tomorrow’s US data, such as Retail Sales, is weaker than expected. It also limits possible losses if the resistance holds firm and the price moves lower. On the other hand, since the Jackson Hole event carries significant risk, it’s wise to hedge against a downturn. Buying put options with a strike price below the current upward trendline—perhaps around 0.5900—can protect existing long positions. This serves as insurance against a potentially hawkish message from Powell, which could strengthen the dollar and push the NZDUSD lower. With significant events approaching, implied volatility is likely to rise. A long straddle strategy, which involves buying both a call and a put option at the same strike price, could help traders profit from large price swings in either direction. This approach is ideal for traders who expect a major market-moving announcement but are uncertain about which way the market will go. Create your live VT Markets account and start trading now.NIESR forecasts 0.5% growth for the UK economy in Q3 despite uncertainties
The UK economy is expected to grow by a modest 0.5% in the third quarter (Q3), according to NIESR. This growth is driven by strong service and construction activity, along with supportive government policies, despite some weakness in external conditions.
NIESR points out that the negative growth seen in April and May could actually help boost Q3 figures. However, they warn that fragile public finances might lead to budget cuts in the Autumn.
Impact Of Policy Uncertainty
The institute has highlighted that ongoing uncertainty in government policy could harm the UK’s debt outlook, representing a risk to their growth prediction. They emphasize that this is just an early estimate, and various factors could still change the economic situation in Q3. The UK economy is sending a positive signal with a forecast of 0.5% growth for the third quarter. This could lead to slight increases in UK investments, like the FTSE 100 and the Pound, in the coming weeks, encouraging traders to adopt cautiously optimistic strategies. This outlook is backed by a slowing decline in the job market. Unemployment has remained steady at 4.4% for the three months ending in June 2025. The recovery from poor performance in April and May also helps boost expectations for Q3. This may favor short-term call options on UK indices or long positions in GBP/USD, which is currently around 1.28. However, we need to consider the significant concerns regarding the UK’s fragile public finances. The government is likely to propose budget cuts this Autumn, which could quickly erase any short-term benefits. The possibility of future austerity measures or tax increases could overshadow this otherwise positive outlook.Strategies For Market Volatility
This situation is tricky, as the Bank of England faces pressure from persistent inflation, which remained stubbornly high at 3.5% in July 2025. High policy uncertainty often leads to market fluctuations, as seen during the disruptions following fiscal announcements in late 2022, reminding us how quickly market sentiment can shift. With a positive short-term growth outlook yet significant medium-term policy risks, investing in volatility itself may be wise. We should explore strategies that benefit from large market swings in either direction as we approach the Autumn Budget announcements. Implied volatility on FTSE options expiring late in the fourth quarter may be quite attractive. In the coming weeks, we should focus on any government statements about the upcoming budget and inflation reports. Monitoring UK Gilt yields will also be crucial, as a sharp increase could indicate rising concern about the country’s debt. These factors will help determine market direction. Create your live VT Markets account and start trading now.Gold price stays stable as traders wait for key economic data that could affect future breakouts
Gold prices are steady and waiting for new developments that could trigger movement. Interest rates remain uncertain, with the September Non-Farm Payrolls (NFP) possibly changing expectations.
The US Consumer Price Index (CPI) matched predictions, leaving markets unaffected. There is a strong expectation for a rate cut in September, with some considering a 50 basis point move. However, this could be too aggressive if strong economic data appears before the Federal Open Market Committee (FOMC) meets.
Gold Price Forecast
In the long run, gold is expected to rise due to expected easing from the Fed and lower real yields. In the short term, changes to interest rate expectations could cause brief declines. On the daily chart, gold is trading between the 3,438 resistance level and the 3,245 support level. A breakout in either direction is still pending further clues. The four-hour chart shows some minor support around 3,330, where buyers are poised for potential rallies. The hourly chart reveals a slight upward trend, indicating bullish momentum. Buyers will depend on this trend to boost prices, whereas sellers are looking to break down toward lower supports. Key upcoming economic reports include the US Producer Price Index and Jobless Claims, followed by US Retail Sales and the University of Michigan Consumer Sentiment report. Gold continues to trade sideways as we await a clear signal for a breakout. The July CPI report, which showed a slight cooling in inflation to 2.8%, didn’t significantly impact the market. The September meeting of the Federal Reserve is now in focus for guidance.Traders’ Expectations
There remains a strong expectation for a rate cut next month, with fed funds futures indicating over an 80% chance of a 25 basis point reduction. Some are even speculating about a 50 basis point move, which seems too optimistic. A robust jobs report for August could easily challenge this view and cause a sharp shift in pricing. Overall, the long-term outlook for gold should be positive as long as real yields drop and the Fed continues to ease. High yields in 2023 had previously capped gold prices. Any unexpectedly strong economic data in the next few weeks could trigger similar short-term corrections. On the daily chart, we find ourselves in the middle of a range defined by the significant $3,438 resistance and the $3,245 support. Until we see a clear break, traders are likely to buy near the lower end and sell close to the upper end of this range. Looking at the 4-hour chart, there is minor support around $3,330, where buyers have recently entered the market. Those considering a long position might view a pullback to this level as an opportunity, with a clear risk level below it. On the other hand, sellers will watch for a strong break of this support to push prices down toward the main $3,245 level. On the 1-hour chart, a slight upward trendline indicates immediate bullish momentum. Buyers will likely depend on this trendline to help push prices higher within the range. If this line breaks, it could signal sellers that momentum is shifting, potentially testing the $3,330 support area. Today’s Producer Price Index (PPI) and the latest Jobless Claims data will provide additional insight into inflation and the labor market. Initial claims were reported at 225,000, indicating ongoing resilience in the labor market. Tomorrow, we will conclude the week with the July Retail Sales figures and the preliminary University of Michigan Consumer Sentiment report. Create your live VT Markets account and start trading now.European equities start stable while US futures see a slight decline
European stocks started the day with small changes. The Eurostoxx, Germany’s DAX, and Spain’s IBEX all climbed by 0.1%. The CAC 40 in France was up by 0.2%. In contrast, the UK FTSE fell by 0.2%, while Italy’s FTSE MIB rose by 0.3%.
In the US, futures took a slight break, with the S&P 500 futures dropping by 0.1%. This week has been busy for the stock market, especially with the US Consumer Price Index report set to be released on Tuesday. More data is expected later today, including the Producer Price Index and weekly jobless claims.
Market Movements
Today’s markets are mostly stable, taking a breather after strong gains earlier this week. The rally was driven by Tuesday’s US Consumer Price Index report showing inflation easing to a yearly rate of 2.8%. This raised expectations for a change in Federal Reserve policy. Today’s calm comes before the Producer Price Index and jobless claims data, creating an opportunity for traders. We are waiting to see if today’s data confirms the trend of easing inflation. Recent reports indicate that producer prices have also decreased, while initial jobless claims are slightly up to 235,000, suggesting a softer labor market. This trend supports the idea that central banks may hold off on raising interest rates further. With major indices like the S&P 500 and Eurostoxx holding steady, implied volatility remains low. The VIX index is around 13, significantly down from the levels above 25 seen during inflation surges in 2022 and 2023. This makes options relatively affordable for traders preparing for the next market move.Trading Strategies
As the market pauses ahead of the September central bank meetings, there are opportunities in strategies that profit from sideways movement. Selling options premiums using iron condors on major indices can generate returns if stocks stay within a certain range over the next few weeks. Traders should stay alert, as this calm period could suddenly end with new economic news. This situation mirrors market behavior in 2023, where calm times were followed by sharp reactions to key data releases. Therefore, it may be smart to use this quiet moment to buy some downside protection, like inexpensive puts, or set up bullish call spreads for October. This approach allows participation in a potential breakout while clearly defining risk. Create your live VT Markets account and start trading now.Core annual inflation in France reached 1.5% in July, putting pressure on the ECB.
France’s final Consumer Price Index (CPI) for July confirmed a year-on-year increase of +1.0%, the same as preliminary numbers. The rate for the previous month was also +1.0%.
The Harmonised Index of Consumer Prices (HICP) also stayed steady at +0.9% year-on-year, consistent with its preliminary reading. June’s HICP rate was also +0.9%.
Inflation Trends in France
Core annual inflation in France rose from 1.2% in June to 1.5% in July. Even with this increase, it remains below the 2% mark. The European Central Bank (ECB) will keep a close eye on this trend, especially since similar increases have been seen in Spain and Germany. The latest inflation data for July 2025 confirms what preliminary figures indicated. While the main CPI held steady at 1.0%, core inflation’s rise to 1.5% signals growing price pressures, albeit at a slow pace. This trend isn’t only happening in France; it is also seen across Europe. Germany’s HICP recently reported at 2.1%, and Spain’s was even higher at 2.3%. These numbers are creeping above the ECB’s 2% target, indicating a broader inflationary trend.ECB Policy Implications
This situation complicates the ECB’s position, likely delaying any potential interest rate cuts. Now, markets are factoring out rate cuts that were expected for late 2025, and short-term German bond yields have already risen by 15 basis points this month. This suggests that traders might benefit from strategies like using EURIBOR futures to position for higher short-term rates. A more hawkish ECB usually bolsters the euro, a trend we are witnessing as the EUR/USD pair has climbed from 1.08 to near 1.10 in the past two weeks. Traders might consider buying call options on the euro to take advantage of this potential strength. Increased volatility in euro currency pairs is also likely, making strategies that profit from larger price fluctuations even more appealing. For equity markets, the likelihood of sustained high interest rates presents challenges. The Euro Stoxx 50 index has already dipped 1.2% since the inflation data began to emerge from member states. In this environment, it may be wise to consider protective put options on major European indices like the German DAX or French CAC 40. Create your live VT Markets account and start trading now.Producer and import prices in Switzerland decreased by 0.2% from the previous month
In July, Switzerland saw a 0.2% decrease in producer and import prices, according to the Federal Statistics Office on 14 August 2025. Producer prices fell by 0.3%, but this was somewhat offset by a 0.1% rise in import prices.
Overall, prices for producer and import goods dropped 0.9% compared to July of last year, mainly due to a decline in import prices. While producer prices stayed the same year-on-year, import prices decreased by 2.8%.
