Pound (GBPUSD=X)

The value of the pound has edged higher after official figures showed Britain’s economy slowed down in the run-up to the budget.

Sterling was up 0.1% against the dollar to $1.2665 but slipped 0.2% against the euro (GBPEUR=X) to €1.1991.

In the second quarter, the economy expanded 0.5% amidst expectations that the economic recovery was gaining momentum and a business-friendly Labour government was about to take the reins.

“The pound is higher on Friday; however, this is due to a general move lower in the dollar and does not appear to be linked to the GDP report. If the dollar continues its decline, then we could see a return to the $1.27 handle in GBP/USD. The market is not expecting the BOE to cut rates next [month], with only a 15% chance of a cut,” Kathleen Brooks, research director at XTB UK, wrote.

Read more: UK growth slows between July and September as services sector falters

Growth of 0.1% represents an undershoot of the Bank of England's projection made in the November Monetary Policy Report.

Gold (GC=F)

Gold prices have slumped to a two-month low as a strong dollar is making the precious metal more expensive for overseas buyers.

Spot gold rose marginally by 0.1% to $2,565.88 per ounce as of Friday, recovering slightly from a two-month low earlier in the session. Meanwhile, US gold futures edged 0.1% lower to $2,569.20.

The dip reflects shifting expectations around US monetary policy, with investors bracing for a tighter US Federal Reserve stance in 2025 under Donald Trump’s administration. Anticipation of higher interest rates diminishes gold’s allure, as the opportunity cost of holding non-yielding assets like gold increases.

Fed chair Jerome Powell reinforced this cautious outlook on Thursday, saying that steady economic growth, a strong labour market, and persistent inflation above the 2% target suggest little urgency for rate cuts. His comments followed fresh data showing US producer prices accelerated in October, signalling that progress on curbing inflation may be stalling.

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Market expectations for a December rate cut have cooled significantly. The CME FedWatch tool now indicates a 58.9% probability of a 25-basis-point rate cut, down from 83% the previous day. Powell's remarks further tempered hopes for immediate monetary easing, adding to the headwinds for gold.

Oil (BZ=F)

Oil prices fell on Friday as signs of tepid demand from China, the world’s largest crude importer, and a Trump 2.0 administration weighed on markets.