Daily Analysis 17/07/2026

• GBP/USD Price: The GBP/USD pair remains under pressure for a second consecutive session, trading around 1.3460 during Friday's European session.
• IMF warning: The International Monetary Fund (IMF) has reportedly warned incoming UK Prime Minister Andy Burnham that there is limited room for higher public spending due to the UK's challenging fiscal position.
• BoE's Bailey: Earlier this week, Bank of England Governor Andrew Bailey acknowledged that renewed tensions between the US and Iran are a source of concern.
• Market pricing: According to Reuters market pricing, investors continue to fully expect a 25-basis-point Bank of England rate hike by November, with a second increase projected by April 2027.
• UK-China: China's Ministry of Commerce (MOFCOM) criticized the UK government's decision to nationalize British Steel, stating it strongly opposes the move.

Closing statement: GBP/USD remains under pressure as Dollar strength outweighs expectations for future Bank of England rate hikes. Investors will continue monitoring UK fiscal developments, central bank signals, and geopolitical tensions for further direction.

• XAU/USD Price: Gold (XAU/USD) is holding onto modest recovery gains around the $4,000 psychological level during Friday's European session.
• US-China tensions: During a national address, President Donald Trump accused China of illegally obtaining US election data related to the 2020 election and called on the Director of National Intelligence and the FBI to investigate the matter.
• Fed's Schmid: Kansas City Fed President Jeff Schmid stated that recent inflation data is encouraging but warned that it is too early to conclude that inflation has been defeated.
• US data: The Philadelphia Fed Manufacturing Index jumped from 10.3 to 41.4 in July, reaching its highest level since November 2021.
• Fed's Jefferson: Federal Reserve Vice Chair Philip Jefferson said he would be prepared to support additional interest rate hikes if inflation fails to improve in the near term.

Closing statement: Gold is finding support from heightened geopolitical tensions, but gains remain capped by strong US economic data and continued hawkish signals from Federal Reserve officials. The balance between safe-haven demand and expectations for higher interest rates is likely to remain the key driver of XAU/USD in the near term.

• Crude Oil Price: West Texas Intermediate (WTI) is trading around $79.00 per barrel during Friday's European session.
• Red Sea shipping: According to media reports, Iran has instructed Yemen's Houthi forces to close the Bab el-Mandeb Strait if the United States targets Iran's power infrastructure.
• Fresh attacks: Reports from Fars News indicated that loud explosions were heard in Kuwait, with the blasts also audible in Basra, Iraq. Meanwhile, Qatar's Defence Ministry confirmed that it successfully intercepted a missile attack.
• Fed's Logan: Dallas Fed President Lorie Logan said that this week's softer consumer and producer inflation data were not yet enough to indicate meaningful relief for US households.
• IEA warning: International Energy Agency (IEA) Executive Director Fatih Birol warned that global energy security could come under serious pressure if the US and Iran fail to restore normal oil flows through the Strait of Hormuz.

Closing statement: WTI remains well supported near $79.00 as geopolitical tensions across the Middle East continue to dominate market sentiment. While concerns over supply disruptions are driving prices higher, traders will also monitor central bank policy expectations and developments around key shipping routes for further direction.

• DAX 40 Price: The DAX 40 is trading lower around the 24,760-point mark on Friday as investors remain cautious.
• BASF patent: Syngenta has filed a federal patent infringement lawsuit against German chemical giant BASF. The legal dispute could create uncertainty for BASF and may weigh on sentiment toward the broader German chemicals sector.
• Tariff call: Saxony's Economy Minister Dirk Panter has called for higher tariffs on Chinese electric vehicles, arguing that stronger trade protection could improve the prospects of securing investment for Volkswagen's Zwickau plant, which faces the risk of closure.
• Fed's Logan: Dallas Fed President Lorie Logan reiterated that the Federal Reserve still has work to do in restoring price stability. She stated that some degree of restrictive monetary policy remains necessary and suggested that modestly higher interest rates would better balance economic risks, reinforcing expectations of tighter financial conditions.
• Adidas decline: Adidas shares fell sharply despite the prospect of a World Cup final featuring Argentina and Spain, both sponsored by the German sportswear company.

Closing statement: The DAX 40 remains on the defensive as investors weigh corporate news, trade policy developments, and the prospect of higher US interest rates. Attention will remain on earnings, global monetary policy, and geopolitical developments as key drivers of German equities in the near term.