When the Fed Pauses and Metals Run: A Shift in Market Mood

Ahmad Mortazavi
Sep 10, 2025
3 min read

Updated: Sep 29, 2025

🌍 Big Picture: Navigating Market Turbulence

Financial markets recently experienced turbulence due to a sharp slowdown in U.S. job creation, a strengthening bond rally, and renewed global tariff tensions. July’s U.S. nonfarm payrolls revealed only 73,000 jobs added, accompanied by downward revisions to previous months. This was a significant downside surprise. The bond market reacted swiftly: the 2-year Treasury yield dropped nearly 25 basis points, while the 10-year yield fell to 4.37%. This shift signals expectations of earlier-than-anticipated rate cuts.

Equity markets slid across regions. The S&P 500 fell by 2.4%, and the Nasdaq dropped by 2.2%. Asian indices also declined, influenced by weakness in China’s PMI and volatility in the Japanese yen. Europe remained relatively stable as energy prices eased. However, investors grew nervous over stalled growth and fiscal cracks in Germany.

Meanwhile, the U.S. Dollar Index (DXY) fell nearly 1%, breaking its July rally as economic surprises eroded the case for dollar strength. Commodities presented a mixed picture: oil dropped by 4.2% due to improving supply outlooks, while precious metals surged. Gold and platinum led the charge as investors sought refuge in safe-haven assets.

📊 Assets at a Glance: Understanding Market Movements

📅 Key Events Next Week: What to Watch For

Monday, August 4

U.S. Factory Orders (June): A modest increase is expected. This could impact industrials and Fed rate expectations.
Eurozone Retail Sales (June): A weak reading may reinforce the ECB’s dovish stance.

Tuesday, August 5

China Caixin Services PMI (July): Investors will assess if the services sector is rebounding in tandem with policy support. A strong reading may lift Chinese equities.
U.S. ISM Services PMI (July): This is closely watched for signs of consumer and service strength.

Wednesday, August 6

New Zealand RBNZ Rate Decision: Likely on hold. Any hawkish tilt may impact AUD/NZD pairs.
U.S. Trade Balance (June): Shifts in exports/imports will offer clues on global demand and dollar direction.

Thursday, August 7

Bank of England Monetary Policy Decision: Markets expect no change, but inflation commentary and vote split will drive sterling.
Germany Factory Orders (June): A key barometer for Eurozone recovery hopes.

Friday, August 8

U.S. PPI (July): This is crucial for the inflation trajectory. A surprise print may swing Treasury yields.
Canada Jobs Report (July): Important for BoC policy expectations. The CAD is likely to react strongly.

Overarching Themes to Consider

Central banks globally may pivot cautiously dovish as macro data weakens. Investors are closely watching inflation data, particularly U.S. PPI, to calibrate the Fed's outlook. Additionally, tariff rhetoric between the U.S., EU, and China may resurface, impacting trade-exposed sectors.

💡 Investment Idea: The Case for Platinum

With gold plateauing and bond markets now pricing in rate cuts, platinum has emerged as a compelling real asset play.

Technical Outlook

The price broke decisively out of the $835–$1,135 range.
The last monthly candlestick closed at $1,338.90, confirming breakout strength.
Support sits near $1,335.74; maintaining this level affirms bullish momentum.

Fundamental Drivers

The 2025 platinum market remains in structural deficit, estimated at around 529,000 ounces. South African mine output disruptions, combined with a 26% rise in Chinese jewellery demand, are significant factors. Furthermore, investor rotation out of palladium and into value metals continues.

Macro Catalysts

A falling dollar and weaker bond yields support metal prices. Additionally, further central bank accommodation or geopolitical flare-ups could amplify flows into platinum.

Strategic View

Long positions above $1,335.74 remain valid. Target zones are set between $1,400 and $1,420 per ounce. Stop losses should be placed below $1,330 for active trades.

Risk Disclaimer

The information provided in this newsletter is for educational and informational purposes only and should not be considered financial advice. Financial markets involve substantial risk, and investments can fluctuate in value, leading to potential losses. Past performance is not indicative of future results. Before making any investment decisions, readers should consider their own risk tolerance and financial situation and consult with a licensed financial advisor if necessary. The strategies and opinions expressed are based on current market conditions and may change without notice.