The UK's invisible tax increase is approaching. Analysis of the short-term trends of spot gold, silver, crude oil and foreign exchange on November 19

Global market overview

1. European and American market conditions

The three major U.S. stock index futures all rose, with the Dow futures rising 0.25%, the S&P 500 futures rising 0.45%, and the Nasdaq futures rising 0.53%. Germany's DAX index rose 0.40%, Britain's FTSE 100 index rose 0.15%, France's CAC 40 index rose 0.05%, and the European Stoxx 50 index rose 0.18%.

2. Interpretation of market news

The UK’s invisible tax increase is approaching, political choices under the 80 billion pound fiscal gap

⑴ British Prime Minister Starmer refused on Wednesday to rule out the possibility of extending the freeze on the income tax threshold, leaving a key suspense for next week’s budget. ⑵ Chancellor Reeves needs to raise tens of billions of pounds in the November 26 budget to maintain his self-imposed fiscal rules. ⑶ Although government sources ruled out raising the income tax rate on the 14th of this month, extending the freeze on the tax threshold for two years to 2030 can increase fiscal revenue by 8 billion pounds per year. ⑷ When responding to a question in the House of xmtraders.commons, Starmer only said that "specific plans will be announced in next week's budget" without making any clear xmtraders.commitment. ⑸This potential policy change is in direct conflict with Labor's campaign promises. Reeves last year clearly regarded the extension of the threshold freeze as a violation of his declaration not to increase taxes on "working people". ⑹ She promised in last year's budget that "from 2028-29, the personal tax threshold will return to being indexed to inflation." ⑺ Freezing the tax threshold is essentially a hidden tax increase. As wages increase, more taxpayers will be pushed into a higher tax rate range. ⑻ While alleviating fiscal pressure, this policy may suppress consumer demand and affect economic growth prospects.⑼Investors need to pay attention to changes in British household disposable income after the budget is announced, and its impact on the consumer sector and the overall economy.

The divergence of global government bond yields has intensified, with British and American high-yield leading the market pattern

⑴The German 2-year government bond yield was reported at 2.016%, becoming the benchmark anchor rate for major European countries. ⑵ The 2-year yield in the United States reached 3.577%, 156.1 basis points higher than that in Germany, showing that the monetary policy expectations of the two countries are significantly different. ⑶The UK 2-year yield is reported at 3.775%, the highest among major developed countries, with a premium of 175.9 basis points xmtraders.compared to Germany. ⑷ Japan’s 2-year yield is only 0.931%, 264.6 basis points lower than the United States, maintaining the lowest yield level in the world. ⑸Australia’s 2-year yield is 3.660%, forming a high-yield camp together with the United Kingdom and the United States, reflecting its continued inflationary pressure. ⑹The 10-year U.S. bond yield is at 4.116%, still at a high level globally, but 45.2 basis points lower than the UK. ⑺The UK’s 10-year yield reached 4.568%, the highest among major economies, with a premium of 187.6 basis points over Germany. ⑻ Germany’s 10-year yield was reported at 2.692%, becoming the pricing benchmark for core European countries, with the yields of many countries forming a gradient distribution around it. ⑼ Japan’s 10-year yield is 1.772%, 234.5 basis points lower than that of the United States, indicating that its loose monetary policy continues. ⑽ The difference in yields reflects the inflation prospects and policy paths of various countries, and high-yield countries face greater pressure for economic growth.

EU technology regulation has shifted towards simplifying regulations to xmtraders.compete for AI xmtraders.competitiveness

⑴ The European xmtraders.commission proposed on Wednesday to streamline and relax a series of technology regulations, including delaying the implementation of some provisions of the Artificial Intelligence Law. ⑵The move aims to reduce red tape, respond to criticism from technology xmtraders.companies, and ultimately enhance Europe's global xmtraders.competitiveness. ⑶The European xmtraders.commission emphasized that "simplification is not deregulation", indicating that it will optimize the regulatory framework while maintaining regulatory robustness. ⑷The regulatory provisions for high-risk artificial intelligence applications originally scheduled to be implemented in August 2026 are recommended to be postponed to December 2027. ⑸Affected high-risk areas include biometrics, road transportation, public utilities, job applications, medical services and law enforcement. ⑹ Proposed changes to the General Data Protection Regulation would allow technology xmtraders.companies to use Europeans’ personal data to train AI models. ⑺This regulatory adjustment covers many important regulations such as the Artificial Intelligence Law, the General Data Protection Regulation, the Electronic Privacy Directive and the Data Law. ⑻ The proposal still needs to be debated and voted on by European countries, and there may be variables in the final content. ⑼ Simplified supervision may provide more flexible space for technology xmtraders.companies such as Google, Meta, and OpenAI to develop in Europe. ⑽ This change shows that the EU is seeking a more precise balance between maintaining a regulatory bottom line and promoting technological innovation.

The growth rate of labor costs in the Eurozone slowed down in the third quarter

⑴ Preliminary data show that hourly labor costs in the Eurozone rose by 3.5% year-on-year in the third quarter, xmtraders.compared with the previous value of 3.6%% has slowed down. ⑵The wage xmtraders.component increased by 3.4% year-on-year, lower than the previous value of 3.7%. ⑶The non-wage xmtraders.component increased by 3.5% year-on-year, xmtraders.compared with the previous increase of 3.6%.

South Africa’s retail sales in September increased by 3.1% year-on-year, and the growth rate accelerated

⑴ South Africa’s retail sales in September increased by 3.1% year-on-year, accelerating from the downwardly revised growth rate of 2.2% in August, basically in line with analysts’ estimates of 3%. ⑵ The main growth contributions came from: xmtraders.comprehensive dealers increased by 1.9% (contribution of 0.9 percentage points); textile, clothing, footwear and leather products retailers increased by 4.4% (contribution of 0.7 percentage points); household furniture, electrical equipment retailers increased by 11.4% (contribution of 0.5 percentage points). ⑶After seasonally adjusted, the month-on-month data remained unchanged, with the previous value falling by 1.6%. ⑷Retail sales in the third quarter of 2025 will increase by 3.6% xmtraders.compared with the same period in 2024.

U.S. mortgage rates have risen for three consecutive weeks, and application volume has fallen sharply

⑴ Data from the American Mortgage Bankers Association shows that as of the week of November 14, the average contract interest rate for 30-year fixed-rate mortgages rose slightly to 6.37% from 6.34% in the previous period. ⑵ This is the third consecutive week of gains, hitting the highest level in about a month, but still 53 basis points lower than the same period last year. ⑶The number of mortgage loan applications dropped sharply by 5.2%, xmtraders.compared with an increase of 0.6% in the previous period. ⑷The number of home purchase loan applications dropped by 2.3%, and the number of refinancing applications dropped by 7.3%.

Russia’s steady increase in production is approaching the OPEC+ quota and the oil discount is about to bottom out

⑴Russian Deputy Prime Minister Novak said on Wednesday that Russia may reach the OPEC+ production quota level by the end of 2025 or early 2026. ⑵ Crude oil production increased steadily in November, with the growth rate slightly higher than the level in October. The actual production that month was 70,000 barrels per day lower than the quota. ⑶ Russia insists on abiding by the OPEC+ agreement, has no plans to voluntarily reduce production, and has xmtraders.completed xmtraders.compensation for the previous overproduction. ⑷ Maintaining the forecast of 510 million tons of liquid hydrocarbon production in 2025 unchanged, showing its confidence in the restoration of production capacity. ⑸ The U.S. sanctions on Rosneft and Lukoil have not affected actual production. Russian oil discounts will gradually decrease and bottom out soon. ⑹ Domestic fuel prices have stabilized due to export restrictions, declining demand and refining operations, and retail prices have begun to fall.

Japan’s fiscal stimulus expectations overwhelm the yen authorities’ emergency talks to halt the decline

⑴ Japanese Finance Minister Katayama Satsuki said on Wednesday that Bank of Japan Governor Ueda Kazuo and the Economy Minister have reached a consensus and will pay close attention to market developments with a “strong sense of urgency.” ⑵ Katayama expressed “no objection” to Ueda’s explanation of gradually adjusting the degree of monetary support through interest rate increases. This statement triggered a rapid weakening of the yen. ⑶ The Japanese yen exchange rate fell below the 156-to-1 U.S. dollar mark, mainly affected by market expectations that the new Takahashi regime's huge spending plan will maintain a low interest rate environment. ⑷ Kyodo News reported that the scale of Japan's stimulus package may exceed 20 trillion yen, with an additional budget of about 17 trillion yen, intensifying the selling pressure on the yen. ⑸This meeting reiterated that we will make every effort to realize the accompanyingThere was an inflation stabilization target for wage growth, but there was no detailed discussion on the size of the spending. ⑹ The new government in which Takahashi advocates expansionary fiscal and monetary policies has taken office, making the central bank's efforts to normalize interest rates face a more xmtraders.complicated situation.

The Federal Reserve minutes are about to reveal internal rifts that may exceed expectations

⑴ The minutes of the Federal Reserve’s October meeting will be released on Wednesday and are expected to reveal in detail the degree of rare disagreements among policymakers. ⑵ Last month’s meeting voted 10-2 to cut interest rates by 25 basis points, with Powell admitting that there were “strong differences of opinion.” ⑶ The data gap has exacerbated policy uncertainty, and officials can only rely on limited information to make assessments, reinforcing their cautious stance. ⑷ Although government data has begun to gradually recover, after the September employment report was released on Thursday, there is still a lack of xmtraders.complete data sets to support decision-making. ⑸The risk balance is extremely sensitive to inflation and employment data, and any unexpected performance may change the delicate balance of the policy balance. ⑹ The market prices the probability of a rate cut in December at only 50%, and any hawkish hints in the meeting minutes may trigger major repricing.

The Italian Ministry of Finance implements bond repurchases to proactively manage short-term debt repayment pressure

⑴The Italian Ministry of Finance announced on Wednesday the successful repurchase of five bonds with a total scale of 5 billion euros, effectively using the central bank account surplus to optimize the debt structure. ⑵ This operation involves four fixed-rate BTP bonds and one floating-rate CCTeu bond, with a clear target of debt due in 2026. ⑶The repurchase funds xmtraders.come from the cash surplus of the Bank of Italy, showing that the Ministry of Finance is actively using fiscal tools to improve liquidity conditions. ⑷Concentrated repurchase of bonds approaching maturity will help smooth the debt repayment peak and reduce the maturity pressure in 2026. ⑸ This move reflects the trend of active debt management among Eurozone member states and reduces refinancing risks through forward-looking operations. ⑹ The market can pay attention to whether other highly indebted countries follow similar operations, and bond buybacks may become the new normal in debt management.

Middle East crude oil premium narrowed, abundant supply suppressed benchmark prices

⑴ Spot premiums for Middle East crude oil benchmarks Oman, Dubai and Murban fell across the board, reflecting the market pressure brought about by abundant supply of cargo for January loading. ⑵ Although demand from Asian customers increased this month, refiners slowed down their purchasing pace and chose to take their time in ordering cargoes for January loading. ⑶ Some refiners are worried about Western sanctions and have turned to increasing Middle East crude oil purchases to replace the original source of Russian supply. ⑷The premium of cash Dubai to swaps fell by 12 cents to 68 cents per barrel, indicating that the recent supply tension continues to ease. ⑸Total and other international oil xmtraders.companies have purchased a total of 8 batches of goods this month, and Trafigura and other traders have purchased 13 batches. Actual trading remains active. ⑹Global refining profit margins hit a multi-year high, but insufficient investment in Western refining energy may continue to support crude oil premiums in the medium and long term.

The non-farm payrolls report will soon reveal that the Federal Reserve has quietly raised the threshold for interest rate cuts

⑴ The French bank Credit Agricole expects non-farm employment to increase by 55,000 in September, released on Thursday, which is a historically low level but a significant improvement from the 22,000 in August. ⑵This line points out the followingBanking risks do exist. ADP data previously showed a decrease of 32,000 jobs, but emphasized that the correlation between the two data series has historically been weak. ⑶ The tightening of immigration policies has lowered the break-even point for employment growth, buffering the impact of soft non-agricultural data on the market. ⑷The unemployment rate is expected to remain at 4.3%, the highest level since the end of 2021, but the rising process will be gradual. ⑸The labor market shows a significant trend of demand slowing faster than supply. This change has attracted the attention of the Federal Reserve and became the basis for consecutive interest rate cuts in September and October. ⑹ As interest rates approach the neutral level, the threshold for another interest rate cut is rising, the decision-making at the December interest rate meeting will become more balanced, and the market may overprice the extent of future easing.

3. Trends of major currency pairs before the New York market opens

EUR/USD: As of 21:20 Beijing time, EUR/USD rose and is now at 1.1590, an increase of 0.07%. Before the New York session, the price (EUR/USD) declined on the last trading day, breaking the key support of 1.1580, affected by negative pressure from its trading below the EMA50, its short-term exit from the range of the bullish correction channel, and the emergence of negative signals on the relative strength indicator.

GBP/USD: As of 21:20 Beijing time, GBP/USD fell and is now at 1.3129, a decrease of 0.11%. Before the New York market opened, (GBPUSD) price fell in the last trading day, surpassing the support of its EMA50, while breaking the bullish corrective trend line that supported the price in the previous period, putting it under strong negative pressure, which was strengthened by the return of negative signals on the relative strength indicator after unloading oversold conditions, opening the way for recording more downward moves.

Spot gold: As of 21:20 Beijing time, spot gold has risen and is currently trading at 4103.24, an increase of 0.88%. Pre-market in New York, (gold) prices extended their gains on the last trading day, surpassing the EMA50 resistance and holding above the $4,100 resistance, supported by its trading as well as a small short-term bullish trend. The relative strength indicator showed positive signals and reached overbought levels, which may reduce the upcoming gains.

Spot silver: As of 21:20 Beijing time, spot silver has risen, now trading at 51.907, an increase of 2.43%. Pre-market in New York, (silver) prices rose strongly in the last intraday session, taking advantage of the dynamic support it represented by trading above the EMA50, surpassing the $52.00 resistance, which representedIn line with our expectations in the previous analysis, the primary bullish trend prevailed and its trading was accompanied by secondary trend lines that supported the trend on a short-term basis.

Crude oil market: As of 21:20 Beijing time, U.S. oil fell, now trading at 58.830, a decrease of 3.00%. Pre-market in New York, (crude oil) prices fell in the last trading session in an attempt to gain bullish momentum that could help it rise and tried to unload some clear overbought conditions on the relative strength indicator, from where negative signals emerged, positive pressure persisted from trading above the EMA50 and was dominated by a minor bullish channel on a short-term basis and its trading along the trendline.

4. Institutional perspective

Barclays: The Philippine central bank may start a four-consecutive downward cycle. GDP plummeted to 4% in the third quarter, triggering a policy shift

Barclays economists predicted in the latest report that the Philippine central bank may initiate four consecutive interest rate cuts starting in December. The report pointed out that the recent review of corruption in flood control projects has had a far greater impact on the economy than Barclays expected, with year-on-year GDP growth in the third quarter plummeting to 4.0% from 5.5% in the second quarter. The bank analyzed that this much lower than expected economic growth may force the Philippine central bank to shift from the current "policy interest rate normalization" mode to a new stage of "actively stimulating the economy through loose monetary policy."

ING: British inflation has peaked but there are still upward risks

⑴ ING economist James Smith pointed out that although British inflation has peaked, the latest data is slightly high for the Bank of England. ⑵ Overall inflation fell to 3.6% in October from 3.8% in September, but food inflation accelerated from 4.5% to 4.9%, an increase that exceeded expectations. ⑶ Smith said, "Strengthening food inflation provides a strong basis for hawkish members." ⑷ He also pointed out that the decline in food inflation in the euro zone and the stabilization of food producer prices indicate that supermarket inflation may have basically peaked. ⑸The current data is not enough to change the position of most members of the Bank of England's interest rate xmtraders.committee. ⑹ Smith added, "We still expect the central bank to cut interest rates at the December meeting."

The above content is all about "[XM Foreign Exchange Official Website]: The UK's invisible tax increase is approaching, short-term trend analysis of spot gold, silver, crude oil and foreign exchange on November 19". It is carefully xmtraders.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!

Only the strong know how to fight; the weak are not even qualified to fail, but are born to be conquered. Hurry up and study the next content!