Daily Analysis 27/02/2025

• GBP/USD Price: The GBP/USD pair declines to around 1.2660 during European trading hours on Thursday, reversing gains from the past two sessions. The pullback comes amid renewed US Dollar strength.
• BoE’s Dhingra: Bank of England (BoE) Monetary Policy Committee Member Swati Dhingra emphasized on Wednesday that central bank policy has limited influence over trade-driven supply shocks, suggesting that external factors could prolong inflationary pressures.
• Fed’s Bostic: Federal Reserve Bank of Atlanta President Raphael Bostic stated that the Fed should keep interest rates unchanged to maintain downward pressure on inflation. His remarks reinforced expectations that rate cuts may be delayed, supporting the US Dollar.
• US Tarrifs: US Commerce Secretary Howard Lutnick announced that April 3 would serve as the baseline for reciprocal tariff measures, with Chinese vehicles banned from entering the US market. This signals escalating trade tensions, which could influence global risk sentiment.
• US Treasury Secretary: US Treasury Secretary Scott Bessent reaffirmed his commitment to working with Congress to solidify President Trump’s tax cuts as a permanent policy. This could impact fiscal policy expectations and broader market sentiment.

Closing statement: GBP/USD faces downward pressure amid a stronger US Dollar, driven by hawkish Fed signals and heightened US-China trade tensions. Market participants will monitor further developments in trade policy and monetary policy for directional cues.

• XAU/USD Price: Gold price (XAU/USD) remains under bearish pressure during the early European session on Thursday, trading near $2,890—a more than one-week low seen on Wednesday.
• Trade Wars: While gold is facing selling pressure, uncertainty surrounding US President Donald Trump’s tariff plans and escalating trade war fears may deter aggressive bearish bets. Safe-haven demand could provide some support.
• Tariff Deadline: A White House official stated that the tariff deadline for Mexican and Canadian imports remains in place, pending Trump's review of efforts to curb migration. This could introduce further geopolitical risks.
• US Data: Thursday’s US economic calendar includes key releases such as Q4 GDP estimates, Durable Goods Orders, Pending Home Sales, and Weekly Initial Jobless Claims, all of which could impact gold’s short-term direction.
• PCE Inflation Data: Investors are looking ahead to the US Personal Consumption Expenditures (PCE) Price Index release on Friday, the Federal Reserve’s preferred inflation measure, for insights into the Fed’s rate-cut outlook.

Closing statement: Gold remains under pressure but could find support amid geopolitical uncertainty. Traders will closely watch upcoming US economic data and Fed-related developments for further price action cues.

• Crude oil Price: West Texas Intermediate (WTI) crude remains under pressure, trading around $68.70 per barrel during European hours on Thursday, just above the two-month low of $68.29 recorded on February 26.
• US-Ukraine Minerals Deal: Reports suggest the US and Ukraine have reached a draft minerals deal, which is seen as crucial for Kyiv’s continued support from Washington. Additionally, sources indicate President Donald Trump is working to expedite an end to the Russia-Ukraine conflict, potentially impacting global energy markets.
• Chevron’s Venezuela License: On Wednesday, President Trump announced plans to revoke Chevron Corp.’s oil license in Venezuela, drawing criticism from Venezuelan Vice President Delcy Rodriguez, who called the move “damaging and inexplicable,” per Reuters.
• Kurdistan-Iraq Agreement: Iraq’s Kurdistan Regional Government has reached an agreement with the federal oil ministry to resume Kurdish crude exports. However, the deal still requires Turkey’s approval before shipments can restart.
• EIA Crude Inventory: Later today, traders will closely monitor the US Energy Information Administration (EIA) crude inventory report for the week ending February 21. Market expectations point to a 2.34 million-barrel increase in oil stockpiles, which could further weigh on prices.

Closing statement: WTI remains weak amid geopolitical shifts and supply-side uncertainty. Investors will watch developments in Venezuela, Iraq, and the upcoming EIA inventory data for further market direction.

• DAX Price: The DAX remains stable at the 22,500 support level, with traders eyeing 22,937 as the next resistance. Meanwhile, concerns over Trump’s proposed copper tariffs and supply fears in Chile are driving commodity prices higher.
• ECB Minutes: Investors will closely follow the European Central Bank (ECB) as it releases the minutes from its late-January interest rate meeting. The details may provide further clarity on the central bank’s policy direction amid evolving inflation trends.
• Corporate Earnings Reports: On the corporate front, German defense supplier Hensoldt and consumer goods giant Beiersdorf are set to release their annual reports, which could influence DAX movements depending on earnings outcomes and forward guidance.
• US Q4 GDP: Across the Atlantic, the US is set to publish its Q4 GDP figures. Markets expect economic growth to have slowed before the year-end, which could influence risk sentiment in European equities.
• Trump’s Tariff Threat: US President Donald Trump has announced plans to impose a 25% tariff on European Union imports, covering cars and various other goods. This move heightens trade tensions and may impact European markets, particularly the auto sector.

Closing statement: DAX is holding key technical levels amid global trade concerns. The ECB minutes, corporate earnings, and US GDP data will be closely monitored for potential market-moving signals.