In the world of markets, the numbers alone do not reveal the full picture. The real movement is formulated behind the scenes, where economic decisions intersect with future expectations, and monetary policies overlap with geopolitical references.
During May 2025, temporary factors coincided with extended structural effects, to produce a complex scene that witnessed the fluctuation of the dollar, the weakness of the euro, the fluctuations in the British pound, the decline in the yen, and the decline in the yuan despite the support attempts.
As for gold, it kept its luster, although it was lightering compared to April. In this analysis, we review the most prominent indicators and the disintegration of the engines code to understand reality, and we are giving the June entitlements.
The American dollar between the pressure of classification and the recovery of confidence
The US dollar index closed at the end of the May 30 session at the level of 99.26 points, recording a decrease of 2.67% compared to its highest levels during the month, which amounted to 101.98 points on the 12th of the same month. The index ranged between 98.69 and 101.98 points during the month, which reflects a state of fluctuation due to economic and political developments.
The most prominent influences in the last week of May
- Economic data: Consumer spending data showed a remarkable slowdown, in addition to registering subsidy requests Unemployment Weekly results are weaker than expected, which indicated signs of economic weakness that negatively affected the performance of the dollar.
- The federal court decision to cancel Customs The American President imposed Donald Trump: Support the dollar for a short period, but it did not hold long for other pressures.
- Statements Federal Reserve (The US Central Bank): Some of its members expressed the need to wait to raise interest, which reduced the dollar momentum.
- Postponing the imposition of fees on Europe: gave a degree of relative stability in the markets, and provided temporary support to the American currency.
The basic extended factors
- cut Credit rating For the United States, where Moody’s has reduced its classification of the excellent degree “AAA” to “AA1” (AA1).
- High public debt andFinancial deficit.
- Commercial tensions escalate with China And Europe.
- Rolls of revenue Bonds American and increase the cost of financing.
- The possession of US bonds has declined by major investors such as China and Japan, which raised additional concerns about trust and markets.
Expectations
The dollar is likely to remain under the pressure of extended factors and presidential policies, with federal decisions and statements Inflation In June. The federal reserve is expected to maintain its cautious approach, which keeps the dollar stuck between the effects of economic data and political pressure.
Gold in May fluctuations and decline
Gold reached its highest level in May at 3438 dollars an ounce, before it declined to close the month at 3289.39 dollars, a decrease of 4.34% of the monthly peak. These moves reflect a state of fluctuation and the change in investor morale.
The effects in the last week of May
- Postponing the fees on Europe, and the US court’s decision to cancel Customs That Trump imposed, contributed to reducing trade tension, which reduced investors’ demand for gold as a safe haven.
- The federal reserve position on the reduction of interest has kept investors on awaiting, which reduced the attractiveness of gold. And the rise in American stock indicators has strengthened the demand for returns assets, at the expense of gold.
The basic extended factors
- The purchases of the global central banks amounted to 244 tons in the first quarter of the year, which represents only 22% of the real demand, which indicates unannounced purchases, which are likely to be led by countries Brexes Group.
- UK credit rating has reinforced the global financial concern, which may support gold in the long run.
- Celebrity and economic fluctuations are escalating and high inflation rates globally.
Expectations
Gold will remain at the time of inflation, commercial policies, and federal decisions. In the short term, the fluctuations remain like. As for the long term, it is expected that gold will maintain its position as a major hedge tool in light of the global uncertainty environment.
The euro between interest pressure and growth challenges
In May, the euro recorded a top at $ 1.1419, and the lowest level at $ 1.1065, before the month closed at $ 1.1348. This closure represents a slight decline of 0.62% of the highest point of the month, in light of the contrast of European monetary policies and the conflict of economic indicators.
The most prominent influences in the last week of May
- Hints European Central Bank Lowering Benefit In June, it increased the pressure on the euro.
- Inflation in Germany (the owner of the largest economy in Europe) is slowing down expectations with more monetary facilitation.
- Banking lending improves some economic support, but its impact on the euro was limited.
- The weak US dollar is relatively supporting the euro.
The basic extended factors
- Stress pressure Inflation.
- Slow Economic growth In the euro area.
- Continuous commercial tensions with US.
- The interest rate gap between the euro and the US dollar, which makes the dollar assets more attractive.
- The German industrial sector has declined, negatively affecting economic expectations on the continent.
Expectations:
The euro is expected to remain under pressure during the first week of June, with the results of a meeting Central Bank European on June 5. If the interest is reduced without hinting for more discounts, this may be given temporary support for the currency. As for the continuation of the facilitation tone, the euro will remain in the circle of weakness.
Sterling .. noticeable movements amid political ambiguity
The pound ranged in May between the highest level at 1.3595 and the lowest level at 1.3139, to close at the end of the month at $ 1.3461. This reflects a 0.99% decrease from its monthly peak.
The effects in the last week of May
- Party ascension Nigel Faraj Before the elections, he created a state of political ambiguity.
- Future reduction expectations exerted pressure on sterling.
- Strong economic growth data provided temporary support.
- The weakness of the American dollar is to limit sterling losses.
- Fears about budget restrictions negatively affected market morale.
The essential essential factors:
- Trends Monetary For England Bank.
- High inflation rates.
- Commercial relations with the United States.
Expectations:
Sterling will remain vulnerable to fluctuation in light of a mixture of inflationary pressures, political ambiguity, and the hesitation of the Bank of England. Any additional delay in reducing interest may give the currency temporarily.
Japanese yen between the pressures of returns and waving intervention
The Japanese yen moved in May between a top at 148.66 and the lowest level at 142.11, to close at 144.60, a decrease of 2.73% of its highest levels. Despite the escalation of government hints to intervene, the returns gap between Bonds American and Japanese contributed to the continued weakness of the yen.
The most prominent influences in the last week of May:
- Tokyo enlargement has strengthened the expectations with a critical tightening.
- Industrial production has declined raised concerns about the economic slowdown.
- The statements of the Bank of Japan (the central bank) have maintained mystery about the future path of interest rates.
- Celebrity tensions escalate increased the demand for the yen as a safe haven.
- The weakness of the US dollar provided relatively support for the yen.
The basic extended factors
- High inflation rates.
- Reducing economic growth forecast for 2025 and 2026.
- The effect of American graphics on Japanese exports.
Expectations
Despite the absence of direct intervention so far, the approach of the yen to the level of 147-148 may push the Bank of Japan to suddenly move to ensure financial stability. Also, the continuation of the speculation and the breadth of the returns gap increases the possibilities of actual intervention in the market.
The Chinese yuan under pressure despite Beijing’s interventions
The yuan inside China scored its highest level at 7.2714 in May, before closing on May 30 at 7.1998, declining 0.98%. In foreign markets, where trading is more liberal, its peak reached 7,2874, and closed at 7.2048, recording a decline of 1.3%.
The most prominent influences in the last week of May
- Ronoting capital exit towards markets with higher returns.
- The Chinese People’s Bank (Central Bank) was installed for a weaker guiding price at 7.1876 on May 27.
- Reducing daily interventions, which reflects greater flexibility in managing the exchange rate.
- The factories sector slowed.
- Commercial tensions are escalating with the United States.
- The central keenness to keep the yuan low to support exports.
The basic extended factors
- Weak local demand and the continuation of the real estate crisis.
- Continuous commercial tensions with Washington.
- High -sales stakes in the foreign markets.
- The great interest gap between China and the United States, as a result of the high American interest and Chinese monetary facilitation policies.
- The money is continuing to flow out.
- The absence of structural financial reforms that support growth.
Expectations
The yuan is likely to remain under pressure in the short term, unless the central intervenes directly or the internal economic data suddenly improve. The general trend remains dounding, but any commercial calm or positive data may slow down the frequency of decline.