Euro Holds Firm as ECB Bets Rise (05.12.2026)

Global markets remained cautious as escalating U.S.–Iran tensions and disruptions in the Strait of Hormuz continued to fuel inflation fears and energy market volatility. 

The euro held near three-week highs as investors increased expectations for further ECB tightening following hawkish remarks from Christine Lagarde. Precious metals traded under pressure from a stronger dollar and persistent inflation concerns, while the Japanese yen weakened amid ongoing geopolitical uncertainty and speculation over future Bank of Japan action. Sterling remained supported near multi-month highs as traders awaited key U.S. inflation data for fresh direction across global markets.

Euro Holds Near Peaks

The euro stayed above $1.175, maintaining levels near a three-week high. Investors are balancing escalating U.S.–Iran friction with a growing likelihood of further ECB rate hikes. Soaring oil prices, driven by the Strait of Hormuz standoff and failing diplomacy, have intensified regional inflation fears. Markets now expect at least two interest rate increases this year after Christine Lagarde confirmed the central bank's readiness to take swift action if price pressures persist.

For EUR/USD, the initial resistance is seen at 1.1770, while the closest support is positioned at 1.1660.

Gold Falls Toward 4,720

Gold prices dipped toward $4,720 as a strong dollar and persistent inflation fears weighed on the metal. Uncertainty surrounding the U.S.–Iran ceasefire and Strait of Hormuz disruptions kept oil prices high, intensifying worries about supply chains. Investors stayed defensive before crucial U.S. inflation reports, while talk of possible new military operations in the Middle East added a fresh layer of geopolitical risk to the global market outlook.

First resistance is seen at $4770, with initial support near $4675.

Yen Weakens Toward 157.5

The Japanese yen slipped to around 157.5 per dollar for a second day as a dominant dollar and U.S.–Iran ceasefire uncertainty fueled inflation risks. Investors are monitoring high-level discussions between Japanese and U.S. officials for signs of currency intervention. Meanwhile, the Bank of Japan suggested that soaring oil prices might provide enough inflationary pressure to justify additional interest rate hikes soon, even as geopolitical volatility continues to support the dollar.

Initial resistance stands at 158.10, while the first support is located at 156.50.

Sterling Eyes 1.36 Level

GBP/USD maintains a bullish bias near 1.36, consolidating close to multi-month peaks ahead of the pivotal U.S. inflation report. A hawkish Bank of England stance and broader dollar weakness continue to underpin the pound. However, upward momentum has slowed as investors evaluate stiff technical resistance, UK political developments, and global geopolitical risks, keeping the pair in a cautious holding pattern before the next volatility catalyst.

From a technical view, resistance stands near 1.3610, with support around 1.3520.

Silver Dips Toward 85

Silver fell toward $85 as initial gains disappeared. High oil prices and inflation fears, driven by Middle East volatility and Strait of Hormuz disruptions, weighed on the metal. Donald Trump's comments on the unstable U.S.–Iran ceasefire further clouded the outlook. While industrial growth and safe-haven needs previously supported prices, investors have now moved to the sidelines ahead of critical U.S. inflation data to find a clearer trend.

From a technical view, resistance stands near $87.80 while support is located around $83.20