Gold Awaits NFP, Yen Hits Five-Month High (03.10.2025)

EUR/USD rose on US slowdown concerns and German fiscal reforms, while the yen strengthened past 148.

BOJ's Cautious Tightening Fuels Yen's Rise

The Japanese yen strengthened past 148 per dollar on Friday, hitting a five-month high as safe-haven demand rose with escalating trade tensions and Trump’s shifting tariff policies. Concerns over the US economy drove traders toward the yen and Swiss franc.

Domestically, expectations of further BOJ rate hikes supported the yen and government bond yields. BOJ Deputy Governor Shinichi Uchida signaled that rate increases could continue if economic forecasts align, though monetary conditions remain highly accommodative with minimal bond reductions.

Key resistance is at 149.20, with further levels at 152.00 and 154.90. Support stands at 147.10, followed by 145.80 and 143.00.

Gold Steady on Trade and Labor Data

Gold hovered around $2,900 per ounce, set for a weekly gain. While Trump temporarily paused 25% tariffs on most Canadian and Mexican goods, Canada’s retaliatory tariffs remain, and China’s countermeasures take effect next week.

U.S. labor data showed mixed signals as layoffs hit a 2020 high per the Challenger report, while jobless claims fell more than expected. Investors now await the non-farm payrolls report for further labor market insights and potential Fed policy impact.

Key resistance stands at $2,923, with further levels at $2,955 and $3,000. Support is at $2,860, followed by $2,830 and $2,790.

US Jobs Data Supports GBP/USD Rally

GBP/USD started the week strong, trading around 1.2940-1.2945 in the Asian session, near its four-month high. The US dollar index remains weak after Friday’s underperforming nonfarm payrolls report, which showed that only 151K jobs were added in February, below expectations. January’s figure was also revised down to 125K, and the unemployment rate rose to 4.1%.

These data fueled concerns that Trump’s policies could slow US economic growth, reinforcing expectations of multiple Fed rate cuts this year. Markets anticipate three 25bps cuts in 2025, further weighing on the USD. Despite Fed Chair Powell stating there’s no rush to cut rates, USD bulls have struggled to gain traction.

Meanwhile, GBP is supported by expectations that the BoE will cut rates more gradually than other central banks, strengthening the pair’s outlook. With no major UK or US economic releases, market sentiment will likely be driven by USD movements, offering short-term trading opportunities.

If GBP/USD breaks above 1.2920, the next resistance levels are 1.2980 and 1.3050. On the downside, support stands at 1.2860, with further levels at 1.2760 and 1.2660 if selling pressure increases.

Weak China PPI Pushes Silver's Down

Silver continued its three-day decline, trading around $32.40 per ounce in Monday’s Asian session, pressured by weaker economic data from China. The country’s Producer Price Index (PPI) fell 2.2% year-on-year, marking continued deflationary pressures, while the Consumer Price Index (CPI) dropped 0.7%, the first consumer deflation since January 2024.

Despite these factors, silver’s downside remains limited due to escalating trade tensions. China imposed a 100% tariff on Canadian agricultural goods in response to previous Canadian tariffs, adding to global trade uncertainty following Trump’s recent tariff policies. While a one-month exemption was granted for certain North American goods, trade risks persist.

Silver’s safe-haven appeal may also strengthen amid US economic concerns. San Francisco Fed President Mary Daly warned that rising business uncertainty could weaken demand, fueling speculation about future economic challenges.

If silver breaks above $32.75, the next resistance levels are $33.15 and $33.80. On the downside, support is at $31.00, with further levels at $30.20 and $29.75 if selling pressure increases.