German Business Activity Growth Loses Momentum in November, PMI Shows

After rallying above 1.16 earlier in November, the Euro to US Dollar exchange rate (EUR/USD) slipped back towards the mid‑1.15s as investors rethought the outlook for US monetary policy.

Latest — Exchange Rates:Pound to Dollar (GBP/USD): 1.30862 (+0.02%)Euro to Dollar (EUR/USD): 1.15457 (+0.1%)Dollar to Japanese Yen (USD/JPY): 156.7795 (-0.38%)

The Federal Reserve's latest meeting minutes revealed a committee increasingly wary of cutting rates again, and several officials warned that easing too aggressively could damage inflation‑fighting credibility.

Those hawkish signals pushed US yields higher and drew capital into the dollar, leaving the euro struggling to regain traction.

Even a late‑week bounce in equities did little to lift the single currency as risk appetite remained fragile.

Equity whipsaw after Nvidia's surge and slump

The mood darkened further when the spectacular rally in a major US semiconductor stock, fuelled by optimism over artificial‑intelligence demand, abruptly reversed.

Shares initially spiked on bumper earnings and bullish guidance, driving indices to record highs.

Within hours, however, profit‑taking and concerns about stretched valuations triggered a sharp sell‑off that dragged the Nasdaq and S&P 500 into negative territory.

This whipsaw in equities reinforced the dollar's safe‑haven appeal and kept EUR/USD under pressure even as bond markets gyrated.

Non‑farm payrolls rose by 119,000 in October, comfortably beating expectations for a 53,000 increase, yet the previous month's figure was revised down and the unemployment rate ticked up to 4.4 % from 4.3 %.

Average hourly earnings growth eased to 0.2 % month on month, undershooting the consensus and suggesting wage pressures are moderating.

Weekly unemployment claims edged lower to 220,000 after two elevated readings, but the overall picture remains mixed.

In the absence of a clear trend, investors are balancing a better‑than‑expected jobs headline against signs of cooling wages and a higher jobless rate, leaving the path of US yields and broader sentiment as key drivers.

Meanwhile, recent euro‑zone figures have been underwhelming.

Construction output contracted for a second month and annual growth turned negative, while consumer confidence remains deeply depressed.

European Central Bank vice‑president Luis de Guindos acknowledged that inflation is converging towards the 2 % target but warned that high debt and trade tensions could amplify any downturn.

Divided views on where next

The combination of a fragile economy and hawkish U.S. policy has left analysts divided.

Some technical strategists warn that the euro's failure to hold above its 50‑day moving average signals further downside, with a head‑and‑shoulders pattern hinting at a slide towards the low‑1.14s.

Others see the decline as a temporary correction within a broader reversal pattern, suggesting that support around 1.15 could hold and that the pair might recover towards 1.17 if U.S. data weaken.

A few houses continue to argue that yield spreads justify a stronger euro over the longer term and retain a year‑end 2025 forecast of around 1.18.

The divergence underscores how little conviction there is in either direction.

Markets now turn to a busy data calendar.

In the euro area, investors will parse the final October inflation numbers, November's consumer confidence survey and Friday's flash Purchasing Managers' Indices.

De Guindos speaks twice, on Monday and Friday, and his remarks may help shape expectations ahead of the December ECB meeting.

EUR/USD Technical Outlook: Neutral to Bearish Range

Scotiabank's latest technical analysis describes EUR/USD as neutral to bearish.

A sharp mid‑week pullback dragged the pair back towards its early‑November lows and sent short‑term momentum indicators into negative territory.

Support is seen near the 5 November low in the mid‑1.14s; a break would shift focus towards the early‑August low around 1.14.

On the topside, rallies have failed to hold above the 50‑day moving average near 1.1660.

The bank expects the euro to trade in a narrow 1.1480–1.1580 band in the near term unless data releases provide a catalyst.

Yield differentials still lean slightly in favour of the euro, so dips towards the low‑1.14s may attract buyers, but any meaningful recovery will likely require evidence of a softer U.S. economy.

Source: EXCHANGERATES

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Source: CNBC

British retail sales tumbled in October and a closely watched gauge of household sentiment fell this month, adding to signs of waning consumer spending ahead of finance minister Rachel Reeves' budget next week.

Retail sales volumes fell by 1.1% in October compared with a month before, their first month-on-month fall since May, the Office for National Statistics said on Friday.

Economists polled by Reuters had expected sales to be flat compared with the previous month. Compared with October a year ago, retail sales were just 0.2% higher, against forecasts for a 1.5% annual increase.

Sterling fell briefly against the dollar but soon recovered.

Earlier on Friday, Britain's longest-running consumer survey, from GfK, showed a broad-based drop in consumer morale this month which suggested the public was "bracing for bad news" in Reeves' budget on Nov 26.

"The increasingly chaotic run-up to the budget has begun to weigh on consumer spending, judging by confidence nudging down in November and weakening retail sales growth lately," said Rob Wood, chief UK economist at Pantheon Macroeconomics, a consultancy.

Separate ONS data showed higher-than-expected government borrowing last month, underscoring the scale of the challenge facing Reeves.

She is expected to need to raise £20-30 billion (US$26 billion-US$39 billion or RM107.7 billion-RM161.6 billion) through higher taxes due to an expected growth downgrade from the government's budget watchdog as well as higher borrowing costs and an inability to pass planned welfare cuts through parliament.

Overall consumer spending has been subdued due to a continued high savings rate, which economists say may reflect a surge in inflation in 2022, a more recent weakening in the jobs market and concerns about tax rises in the budget.

Recent updates from major retailers have expressed nervousness about the impact of the upcoming budget on consumer sentiment, particularly for more discretionary purchases. However, supermarket Sainsbury's and food and clothing retailer Marks & Spencer were both upbeat on Christmas trading prospects.

The ONS said supermarket, clothing and mail order sales fell in October, with some retailers citing consumers delaying spending ahead of November's Black Friday discounts.

British retail sales volumes remain 3.3% lower than their pre-pandemic level of February 2020.

Source: Theedgemarkets

Sales at UK retailers slumped unexpectedly last month as shoppers waited for Black Friday deals, and uncertainty over the upcoming budget dampened consumer confidence.

Retail sales fell 1.1% month on month in October, the first fall since May, according to official figures from the Office for National Statistics (ONS). Economists had been expecting sales growth to be flat on the previous month.

Supermarkets, clothing stores and online mail order companies suffered sales declines, which some retailers said was due to consumers delaying purchases in the run-up to the annual Black Friday sales, according to the ONS.

Clothing, footwear and textile stores posted a 3.3% month-on-month drop in sales, the largest fall, after strong summer when shoppers were motivated to buy clothes during warm weather and sporting events improved consumers' mood.

Supermarkets recorded a sales decrease of 1.1% in October, the second consecutive monthly fall.

Online retail sales fell 1.7% month on month, while fuel sales dropped 2.4% in October compared with September.

Some analysts also attributed the surprise fall in sales in October to consumer jitters over the upcoming budget, which the chancellor, Rachel Reeves, will present next week.

"The uncertainty surrounding what the chancellor's budget next week will mean for individuals is only further dampening consumer confidence and spending intentions," said Rajeev Shaunak, the head of consumer at the accountancy and advisory firm MHA.

"The Christmas trading period will be critical, and early sales indicators are expected to confirm that consumer demand remains sluggish, creating a perfect storm for retailers."

On Friday, the research company GfK released data showing that consumer confidence has fallen on every measure of its index this month.

GFK's five sub-indexes record public opinion about people's personal financial situation, propensity to make big purchases and the UK's general economic situation.

The company recorded drops across all five sub-indexes compared with October, resulting in a two-point fall in overall confidence to -19.

The latest monthly survey, which dates back to 1974, showed particular anxiety among earners on salaries between £35,000 and £49,999, with substantial falls in their expectations for their own financial situation and future spending.

"This is a bleak set of results as we head towards next week's budget," said Neil Bellamy, the consumer insights director at GfK. "The public is bracing for difficult news, with little in the current climate to lift expectations."

The ONS revised retail sales for September up from 0.5% to 0.7%, but said August had been revised down from 0.6% to 0.5% growth.

Overall, retail sales remain 3.3% down compared with their pre-pandemic level from February 2020.

Source: GUARDIAN

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Today, the Hong Kong stock index HSI is showing downward momentum, dropping below 25,200 for the first time since mid-October.

Factors adding to selling pressure include (according to media reports):

→ Tech sector slump: Hong Kong is following the US, where investors have started offloading tech giants' shares amid fears of an AI "bubble." Market participants worry that current company valuations are overinflated. Even Nvidia's strong report released this week only provided a short-term boost.

→ Geopolitics: In addition to strained trade relations between China and the US, tensions with Japan have added to uncertainty.

→ China's economic data: Indicators continue to raise concerns despite government stimulus measures.

Technical analysis of the HSI (Hong Kong 50 on FXOpen) shows that price action since late summer 2025 formed an upward channel (marked in blue).

At the same time:

→ on 5 November, the price rebounded sharply from the lower boundary, confirming strong buying interest;

→ this week (as indicated by the arrow), it failed to reverse upwards.

As a result, bears have pushed through an important support level and are attempting to consolidate their gains.

It is possible that:

→ the 25,700 level (where the channel was broken) may act as resistance;

→ bears may grow more ambitious, potentially driving the HSI (Hong Kong 50 on FXOpen) down to test key support around 24,800 in the near term.

Source: FXOpen