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The European Central Bank could deliver another interest-rate cut by mid-2026, but that may not stop the euro from strengthening against the dollar, according to MUFG.

Analysts at MUFG said the Federal Reserve is likely to be more active in easing policy over that period, with markets potentially pricing in additional Fed rate cuts, which would narrow yield differentials in the euro’s favour.

While the ECB has signalled no immediate policy changes, MUFG said there remains scope for further easing if inflation continues to trend lower. He noted that energy prices could ease following OPEC+’s production increase and as China redirects exports away from the U.S., factors that could help bring eurozone inflation down further.

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MUFG’s outlook highlights potential divergence in policy momentum between the ECB and Fed. A faster U.S. easing cycle could limit dollar strength, keeping EUR/USD supported near medium-term highs even if eurozone rates edge lower.

This article was written by Eamonn Sheridan at investinglive.com.

Silver price (XAG/USD) slumps to near $53.65 during the Asian trading hours on Friday. The white metal retreats from a record high of $54.86 in the previous session. However, the potential downside for Silver might be limited amid robust safe-haven demand and US interest rate expectations. 

The Australian Dollar (AUD) moves little against the US Dollar (USD) on Friday, after registering losses in the previous session. The AUD/USD pair may lose ground as the AUD could struggle due to escalating United States (US)-China trade tensions.

“Gold is down because …” Are y’all ready for the tedious hindsight narratives that’ll arrive hours after the fact?

That’s a shame. ‘Cause I don’t have any.

It’s a wild session, slammed from its parabolic high.

There will be more volatility to come.

This article was written by Eamonn Sheridan at investinglive.com.

South Korean Finance Minister Koo said it’s uncertain whether Trump will accept Seoul’s opposition to a US$350 bn upfront investment.

• Seoul warns a one-time payment could destabilise FX markets, risking a crisis.

• Koo raised the issue with U.S. Treasury Secretary Bessent, who agreed to convey Korea’s concerns.

• The July trade deal remains pending amid disputes over investment funding.

Info via Yonhap.

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South Korea’s Finance Minister Koo Yun-cheol said it remains uncertain whether President Donald Trump will accept Seoul’s opposition to a US$350 billion upfront investment tied to their July trade deal.

Speaking in Washington, Koo said such a large one-off payment could destabilise Korea’s foreign-exchange market, potentially sparking financial stress similar to the 1997 Asian crisis.

Koo raised the issue with U.S. Treasury Secretary Scott Bessent, who acknowledged Seoul’s concerns and pledged to relay them to senior officials including Commerce Secretary Howard Lutnick.

He said U.S. officials “understand Korea’s position,” but it’s unclear if Trump will agree. The deal, which would lower U.S. auto tariffs to 15% in exchange for investment commitments, remains pending amid talks over funding terms and structure.

This article was written by Eamonn Sheridan at investinglive.com.

On Friday, the People’s Bank of China (PBOC) set the USD/CNY central rate for the trading session ahead at 7.0949 compared to the previous day’s fix of 7.0968 and 7.1154 Reuters estimate.

The People’s Bank of China (PBOC), China’s central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a “band,” around a central reference rate, or “midpoint.” It’s currently at +/- 2%.

The previous close was 7.1230

The setting today at 7.0949 is the strongest for CNY since 15 October 2024.

PBoC injects CNY 164.8bln via 7-day reverse repos, rate at unchanged 1.40%

• the net drain today is 244.2bn yuan

This article was written by Eamonn Sheridan at investinglive.com.

The NZD/USD pair trades in positive territory near 0.5730 during the early Asian session on Friday. The ongoing US government shutdown and expectations of US interest rate cuts drag the US Dollar (USD) lower against the New Zealand Dollar (NZD).

China’s imports of Canadian oil are set for a record October, exceeding 5 mn bbl so far.

• 70% of Vancouver shipments are heading to China as it reduces reliance on US crude.

• Canadian heavy crude prices have strengthened on Asian demand.

• Vancouver crude now trades at a premium to Texas-loaded Canadian barrels for the first time since 2024.

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China’s crude imports from Canada are on track for a record month in October, as Chinese refiners pivot away from US supplies amid escalating trade tensions, according to Vortexa ship-tracking data. Report comes via Bloomberg.

Nearly 5 million barrels of crude have departed Vancouver so far this month — the highest volume for the first half of any month on record. More than 70% of those cargoes are bound for Chinese ports, with most of the rest heading to the US West Coast or trans-shipment points near Los Angeles.

Chinese buyers have been stockpiling foreign crude at more than 500,000 barrels a day, taking advantage of steep discounts on Russian and Iranian oil while diversifying supply sources. The latest uptick in Canadian shipments comes after Beijing imposed retaliatory port fees on US-linked vessels, raising freight costs for American crude.

Rising Asian demand has strengthened Western Canadian Select (WCS) crude, which was trading at a $10.20 discount to WTI on Thursday — the narrowest since July, despite seasonal weakness in Q4.

This article was written by Eamonn Sheridan at investinglive.com.