Daily Analysis 11/02/2026

• GBP/USD Price: GBP/USD edges higher to around 1.3670 during European trading hours, recovering from mild losses seen in the previous session amid a softer US Dollar tone.
• Political risk: UK political uncertainty continues to cap upside potential. Options markets are pricing elevated downside protection, underscoring persistent concerns around Prime Minister Starmer’s leadership and domestic policy stability.
• BoE's Mann: Comments from BoE policymaker Catherine Mann, a prominent hawk, emphasized the positive contribution of import prices to CPI, signaling resistance to rapid or aggressive monetary easing from at least part of the Monetary Policy Committee.
• Fed's Logan: Dallas Fed President Lorie Logan stated that while inflation is expected to ease further, she would only support additional rate cuts if there is material deterioration in the labor market, reinforcing the Fed’s patient stance.
• Jobs data: Markets are awaiting the delayed US Nonfarm Payrolls report, with expectations for 70K job gains in January and the Unemployment Rate holding at 4.4%. Any upside surprise in employment could revive USD demand and pressure GBP/USD.

Closing statement: GBP/USD is showing tentative recovery, supported by mild USD softness and reduced expectations for near-term Fed easing. However, UK political risks and lingering rate-cut expectations continue to limit bullish momentum. Near-term direction hinges on US labor data, strong jobs numbers could trigger a pullback, while weaker readings may allow the pair to extend gains above recent highs.

• XAU/USD Price: Gold prices hold moderate gains around $5,060 during the European session, recovering part of Tuesday’s pullback as underlying demand remains firm.
• US wages: The US Q4 Employment Cost Index (ECI) surprised to the downside, reinforcing signals from the JOLTs data that wage growth is likely to decelerate through H1 2026, easing inflationary concerns.
• Fed repricing: Fed funds futures have shifted decisively, now favoring a potential rate cut as early as April. The probability of a June cut has climbed toward 80%, up sharply from near even odds earlier in the year, weighing on US yields and supporting gold.
• China inflation: China’s January CPI slowed to 0.2% y/y (vs 0.4% expected), the weakest reading since October. Both food prices (-0.7%) and non-food inflation (0.4%) softened, highlighting fragile domestic demand and reinforcing gold’s appeal as a hedge.
• Key data: Traders are likely to remain cautious ahead of US employment and inflation releases later this week, which will be pivotal in shaping expectations for the Fed’s next policy move.

Closing statement: Gold remains well supported near historic highs, underpinned by slowing US wage growth, dovish Fed repricing, and weak Chinese inflation data. However, with major US labor and inflation reports looming, near-term consolidation is likely, as markets wait for confirmation before committing to a fresh directional move.

• Crude Oil Price: West Texas Intermediate crude is hovering around $64.30 during European trading hours, struggling to gain fresh momentum amid mixed fundamental signals.
• Venezuela supply: The US Treasury Department issued a general license allowing US goods, technology, and services to support oil and gas exploration and production in Venezuela. This move aims to boost Venezuelan crude output, adding to medium-term supply expectations.
• Geopolitical risk: US President Donald Trump renewed threats of possible military action against Iran if Tehran fails to meet US demands on nuclear and missile issues. These comments came as Iran’s security chief Ali Larijani met Oman’s Sultan to discuss outcomes from last week’s US–Iran talks, keeping geopolitical risk premium modestly supported.
• Inventory build: The API weekly report showed US crude inventories surged by 13.4 million barrels last week, sharply reversing the prior 11.1 million barrel draw. The unexpected build revives oversupply concerns and pressures oil prices.
• EIA report: The EIA crude oil stockpiles report will be published on Wednesday. A larger-than-expected crude oil inventory draw indicates stronger demand and could lift the WTI price, while a bigger build than estimated signals weaker demand or excess supply, which might weigh on the WTI price.

Closing statement: WTI remains range-bound, caught between geopolitical risk premiums and rising supply concerns, particularly from Venezuela and US inventories. The EIA data will be key for near-term direction, with downside risks prevailing if inventory builds are confirmed.

• DAX Price: After several choppy sessions, the DAX is hovering around the critical 25,000 level, where bulls are attempting to defend the broader uptrend while bears continue to sell into every rebound. Price action suggests indecision and elevated sensitivity to headlines.
• Siemens Energy: Siemens Energy AG reported nearly triple Q1 net profit, driven by record orders, stronger margins, and improved cash flow. Robust demand for gas turbines and grid infrastructure offers a positive signal for Germany’s industrial and energy transition theme.
• Commerzbank outlook: Commerzbank stated that 2026 net profit is likely to exceed its earlier €3.2bn target, strengthening investor confidence as the lender pushes back against potential takeover interest from Italy’s UniCredit.
• Energy news: While no longer dominating headlines, Germany’s energy shock remains unresolved, with structurally higher electricity and gas prices versus the US and parts of Asia continuing to weigh on heavy industry, chemicals, and manufacturing competitiveness.
• Investment survey: A VDA survey shows that 72% of small- and medium-sized auto supply-chain firms plan to cut back investment in Germany, either by relocating abroad, postponing projects, or cancelling them outright, a worrying signal for medium-term growth and industrial capacity.

Closing statement: The DAX remains technically fragile near 25,000, supported by strong corporate earnings but increasingly constrained by structural cost pressures and weakening domestic investment appetite. A clear break above resistance would require broader confidence in Germany’s growth outlook, while sustained weakness below this zone could invite deeper corrective pressure.