Daily Analysis 13/08/2025

• GBP/USD Price: The pair is trading around 1.3500 during European hours, steady after a 0.5% gain in the previous session. Market sentiment remains balanced ahead of upcoming UK economic data.
• UK Labor Market: The June ILO unemployment rate stayed at 4.7%, matching forecasts, with employment change at 239k vs 185k expected. While the jobless rate is stable, payroll weakness indicates a gradual softening in the labor market.
• Productivity Gap: A report from EY estimates poor public sector productivity costs the UK economy £80bn annually. The gap between public and private sector productivity has widened notably since 2019, highlighting structural economic challenges.
• Rate Cut: According to LSEG data, markets now fully price the next UK rate cut only in February 2026. The Bank of England’s cautious stance could provide underlying support to the pound in the medium term.
• UK Data: Attention is shifting to Thursday’s UK Preliminary Q2 GDP and June factory data, which will offer fresh insight into the country’s growth momentum and industrial activity.

Closing statement: GBP/USD remains resilient, supported by stable labor data and delayed rate cut expectations. Upcoming GDP and factory output figures will be key to determining whether the pair can sustain recent gains.

• XAU/USD Price: Gold slipped to around $3,330 per troy ounce, its lowest in several days, before rebounding slightly to $3,355. The decline was cushioned after US President Trump announced that gold imports would be exempt from new US tariffs.
• CPI Data: US CPI for July held steady at 2.7% YoY, below the 2.8% market forecast. The softer-than-expected inflation print reduced pressure on the Federal Reserve for immediate policy tightening.
• Fed's Bullard: Fed’s James Bullard told CNBC he would be willing to take on the Fed Chair role, emphasizing goals of low and stable inflation and maintaining the central bank’s independence. His comments were seen as neutral for gold markets.
• Fed Commentary: Investors are now watching for speeches from Thomas Barkin and Jeffrey Schmid later Tuesday. Any signals regarding interest rate paths or inflation outlook could impact bullion’s short-term direction.
• Risk Appetite: Despite the tariff exemption boost, improved risk sentiment in broader markets continues to limit safe-haven demand for gold, keeping prices under pressure.

Closing statement: Gold is stabilizing after tariff relief news, but weak safe-haven flows and an improving macro backdrop may cap upside potential unless Fed commentary turns notably dovish.

• Crude Oil Price: WTI crude trades at $62.24 per barrel in early European hours, slipping slightly from Tuesday’s close of $62.50. Price action remains choppy as traders weigh supply-demand forecasts against geopolitical developments.
• OPEC's Outlook: OPEC’s latest monthly report kept the 2025 global oil demand growth estimate unchanged at 1.29 million bpd, while raising the 2026 forecast to 1.38 million bpd, signaling expectations for stronger consumption in the medium term.
• EIA Projection: The EIA’s updated Short-Term Energy Outlook sees Brent crude averaging $50.00 in Q1 2026, citing easing OPEC+ quota restrictions and continued US production growth as the primary drivers of lower prices.
• Geopolitical News: US President Donald Trump is positioning himself as a mediator in Russia-Ukraine ceasefire talks and plans to meet President Vladimir Putin, a move that could indirectly influence oil market sentiment.
• Supply Growth: Acting EIA Administrator Stephen Nalley warned of ongoing market uncertainty, expecting global supply growth to exceed demand gains, which could push oil and refined product prices lower in the US.

Closing statement: WTI is struggling for direction as near-term fundamentals remain overshadowed by medium-term supply growth and falling price projections, while geopolitics provide a potential wildcard for volatility.

• DAX Price: The DAX slipped 0.23% to close at 24,025 on Tuesday, August 12, but managed to stay above the psychologically important 24,000 level, signaling resilience amid mixed market sentiment.
• ZEW Survey: Germany’s August ZEW Current Conditions index fell to -68.6, missing expectations of -65.0. ZEW highlighted disappointment over the US–EU trade deal, with sentiment deteriorating sharply in the chemical and pharmaceutical sectors.
• German Inflation: July’s final CPI came in at +2.0% YoY, matching the preliminary reading. Core inflation remained at 2.7%, suggesting the ECB may maintain a cautious policy stance for longer.
• Index Stocks: SAP tumbled 6.96% as concerns over AI’s impact weighed on software names. Hannover Re fell 3.46% on higher-than-expected large loss claims, pulling Munich Re down 2.61% in sympathy.
• Earning Reports: Investors are watching E.ON and Porsche earnings due on August 13, which could influence near-term DAX direction.

Closing statement: The DAX remains technically supported, but soft economic data, sector-specific pressures, and looming earnings releases keep the index vulnerable to further short-term volatility.