In October, Colombia’s Consumer Price Index (CPI) increased by 0.18% month-on-month, surpassing the 0.13% rise that had been forecast.
This data forms part of a broader global economic context where inflation, exchange rates, and employment figures are closely monitored.
Global Economic Highlights
The New Zealand two-year inflation expectations for Q4 2025 reached 2.28% quarter-on-quarter. The Australian Dollar experienced a decline despite an improvement in Westpac Consumer Confidence.
In China, the People’s Bank of China set the USD/CNY reference rate at 7.0866, a slight increase from the previous 7.0856. Japan is observing price rises due to increased import costs linked to a weak yen.
Other currencies like GBP/USD remain around the 1.32 mark as UK labour data approaches. Gold saw a price increase, trading near $4,120, buoyed by expectations of US rate cuts and a varying US Dollar.
Elsewhere, Bitcoin, Ethereum, and Ripple all traded higher, indicating recovery as bearish trends fade. Coinbase is launching a new platform for crypto offerings, allowing the acquisition of digital tokens before exchange listings.
With the US Federal Reserve’s December meeting approaching, prospects for a rate cut are solidifying, especially after last week’s US jobs report showed wage growth slowing to its lowest level since 2023. This is keeping gold prices firm above $4,100 an ounce. We should therefore consider holding long positions in gold futures or buying call options to capitalize on continued US Dollar softness.
The drop in WTI crude oil below the key $60 level is a major signal of weakening global demand, a narrative supported by the latest manufacturing PMI data from China which fell back into contractionary territory. This weakness in oil, combined with a firm dollar, suggests that put options on WTI or on commodity currencies like the Canadian dollar could be effective strategies. We see this as a trend that will continue into the year’s end.
Currency and Commodity Strategy
We should pay close attention to the divergence between the British pound and the euro. Sterling is showing strength near 1.32 ahead of UK labor data, reflecting a UK economy that has proven more resilient in 2025 than many expected. The euro, however, is struggling at 1.1560, making long GBP/short EUR positions through futures contracts or options spreads an appealing trade.
The Australian dollar continues to lose ground, confirming that global risk factors are overriding positive domestic news. This weakness is compounded by iron ore prices, which have fallen nearly 10% in the last month alone. Given this backdrop, we should view any strength in the Aussie as an opportunity to initiate new short positions or purchase AUD/USD put options.
In emerging markets, the surprise uptick in Colombian inflation to 0.18% will keep its central bank on high alert, a pattern of hawkishness we have seen from them throughout 2025. This should provide a floor for the Colombian peso against other currencies. This makes short USD/COP positions an interesting tactical play, especially if the broader US dollar rally begins to stall.
Finally, while the AI-fueled rally in tech stocks continues, conversations about a potential bubble are getting louder. Implied volatility in the Nasdaq 100 has fallen to multi-year lows, suggesting market complacency. Buying VIX calls or far out-of-the-money put options on major tech indices could be a cheap way for us to hedge against a sudden reversal in sentiment.
