The USD/JPY is trading near 157.50 early Monday after reversing from the 158.00 region in the last hours. This movement reflects the broader market environment marked by risk aversion and uncertainty surrounding the policies of President-elect Donald Trump's administration. Such volatility has driven a surge in safe-haven demand, which might help limit Gold's losses as it trades with mild losses near $2,690.
The stronger US Dollar continues to impact Gold prices, contributing to its current trading position. The Dollar remains well-bid as investors anticipate key economic data releases. The upcoming US inflation report is expected to take center stage, with significant implications for global markets. Meanwhile, in the United Kingdom, the CPI and GDP figures will be closely monitored as the Pound experiences worsening conditions.
In China, pro-growth measures and strong December trade data are offering support to the Australian Dollar (AUD). The AUD/USD is holding its recovery above 0.6150 from over four-year lows, thanks to these supportive factors. China's robust economic performance provides a counterbalance to the prevailing risk-averse sentiment in global markets.
Market participants are navigating a complex landscape characterized by persistent US Dollar strength. This strength is exerting pressure across various asset classes, including precious metals like Gold and currencies such as the British Pound. At the same time, China's economic resilience offers a glimmer of hope for other currencies like the Australian Dollar, which benefit from strong trade ties with China.