Last week's market action was dominated by two major developments: the Federal Reserve's interest rate decision, which undermined one of the last remaining pillars of support for US dollar bulls, and the Japanese authorities' first foreign exchange intervention in several months, which dealt a significant blow to USD/JPY.

Together, these developments triggered a broad-based recovery in non-US currencies. The euro and British pound both gained more than 1.4% over the week, while USD/JPY plunged 3.6%, making it the most volatile currency pair among the G10 currencies.

Global financial markets experienced another turbulent week. Although the latest US inflation figures came in slightly below expectations, they failed to ease investors' concerns about further Federal Reserve rate hikes. Meanwhile, the fallout from Nvidia founder Jensen Huang's sudden resignation continued to weigh on technology stocks, triggering renewed selling pressure and pushing the Nasdaq down 1.5%.

The US dollar approached a 19-month high amid increasingly hawkish interest rate expectations, while the Japanese yen weakened towards the psychologically important 160 level. Gold suffered a weekly decline of more than 4%, and Bitcoin briefly fell below $68,000.

More concerning for investors is the simultaneous emergence of several major risks. US inflation remains elevated, raising the possibility of another Fed rate hike in December. Tensions in the Middle East remain unresolved, with energy shipments through the Strait of Hormuz still facing significant risks. Nvidia's leadership crisis has intensified concerns about the outlook for artificial intelligence investment, while the cryptocurrency market is showing signs of sustained institutional outflows and increased transfers of Bitcoin from miners to exchanges.

Although all three major US stock indices remained on track for weekly gains, signals across multiple asset classes suggest that investors' risk appetite is coming under increasing pressure.

As the Federal Reserve's December policy meeting approaches, global financial markets are likely to remain highly volatile. The greatest risk is not necessarily any single adverse development, but rather the combined impact of persistent inflation, elevated interest rates, stretched technology valuations and geopolitical shocks, which could ultimately trigger a broader repricing across global asset markets.

Last Week's Market Review
US Equity Markets
US equities ended last week on a volatile note as investors weighed inflation data, expectations of further Federal Reserve tightening and the ongoing leadership crisis at Nvidia.

Although the Dow Jones Industrial Average managed to post a modest gain, technology stocks remained under pressure. The Nasdaq Composite fell nearly 1%, while the S&P 500 surrendered its earlier intraday recovery.

Nvidia shares declined another 2% after falling more than 4% in the previous session, as the market continued to digest the impact of Jensen Huang's unexpected resignation. The development has raised considerable uncertainty over the future direction of the global AI chip leader.

Despite the recent turbulence, US equities remained on course to finish the week higher. The Nasdaq gained more than 1% over the week, while both the S&P 500 and Dow Jones were positioned for gains approaching 2%.

This suggests that although short-term volatility in technology shares has increased significantly, the broader market has not yet fully reversed its previous recovery.

Gold
The gold market also experienced substantial volatility last week.

Following the release of US Producer Price Index (PPI) data, spot gold briefly surged to $3,922 per ounce before giving back part of its gains.

As of 9:50 a.m. US Eastern Time, spot gold was up approximately 0.6% at $3,898.84 per ounce, while US gold futures for December delivery rose 0.5% to $3,903.

Despite Friday's modest rebound, gold remained down more than 4% for the week, putting it on track for its worst weekly performance since early June.

Silver
Silver retreated below the $50-per-ounce mark last week, as traders increasingly priced in the possibility of more aggressive monetary tightening by the Federal Reserve over the coming months.

The metal was on course to record a weekly decline of more than 5%.

At the time of writing, silver was trading around $49 per ounce, slightly above its year-to-date low of $48.62, recorded on November 3.

US Dollar Index (DXY)
Amid increasingly hawkish Federal Reserve expectations, the US dollar emerged as one of the strongest-performing major assets in global financial markets last week.

On Friday, the US Dollar Index was trading near 103.40, close to its highest level since April 2025. The index had gained more than 1.0% for the week, putting it on track for its strongest weekly advance in two months.

Developments in the Middle East could become an important driver of the dollar's next move.

If the United States and Iran reach a peace agreement, declining energy prices and reduced safe-haven demand could weaken some of the support currently underpinning the greenback.

However, if tensions in the Middle East fail to ease meaningfully, the dollar could remain firm in the near term and potentially extend its gains.

EUR/USD
The dollar's continued strength placed considerable pressure on other major currencies.

EUR/USD hovered around 1.1053, close to its lowest level since April 2025, after declining approximately 0.8% over the week.

Rees expects the euro to trade largely within the 1.10–1.12 range over the coming months. However, an unusually cold European winter could increase energy demand and place additional pressure on the currency, potentially pushing EUR/USD below the psychological 1.10 level.

USD/JPY
The Japanese yen attracted particularly close attention from currency traders.

USD/JPY was trading near 159.99 on Friday, just below the critical psychological resistance level of 160.

The yen had depreciated approximately 1% over the week and was on track for its largest weekly decline since September, intensifying speculation that Japanese authorities might intervene in the foreign exchange market again.

Market participants believe the 160 level could prompt traders to adopt a more cautious approach. However, whether and when the Japanese government intervenes will ultimately depend on the speed of exchange rate movements and prevailing market conditions.

GBP/USD
The British pound remained relatively stable against the US dollar ahead of the weekend but was still on course for a weekly decline of approximately 0.90%, following the release of US producer inflation data that reached its highest level since November 2022.

GBP/USD was trading around 1.3230.

Recent US inflation figures, hawkish comments from Federal Reserve officials and growing expectations of a renewed monetary tightening cycle pushed sterling lower after the pair reached a weekly high near 1.3460.

AUD/USD
AUD/USD hovered near a ten-month low ahead of the weekend as the US dollar remained strong.

Following its break below the 0.6800 level, the market was looking for signs of a potential recovery.

Growing expectations of further Federal Reserve rate hikes, together with fading hopes of diplomatic progress between the United States and Iran, helped the US dollar retain its gains near the highest levels seen since April 2025.

Meanwhile, the Reserve Bank of Australia's comparatively dovish stance continued to weigh on the Australian dollar, reinforcing the case for further downside.

WTI Crude Oil
WTI crude oil remained heavily influenced by developments in the Middle East last week.

US West Texas Intermediate crude fell approximately 0.25% to $88.52 per barrel.

Although oil prices staged several notable rebounds during the week, WTI remained on track for a second consecutive weekly decline.

On a weekly basis, WTI fell approximately 2.23%, following a much sharper 13% drop in the preceding week.

The substantial price swings over these two weeks highlight how traders are reassessing the actual impact of the Middle East conflict on global energy supplies.

Cryptocurrencies
The cryptocurrency market experienced an even sharper correction than traditional financial markets.

Bitcoin briefly fell to $67,568 last week before recovering towards $68,730.

Later market quotes showed Bitcoin down approximately 3% at $69,361, still below the psychologically important $70,000 threshold and trading near its lowest levels since August.

Ethereum also declined approximately 2.7% to $1,962.02.

Continued outflows from Bitcoin exchange-traded funds, weak buying demand from US investors and growing potential selling pressure from miners suggest that risk appetite in the cryptocurrency market has yet to recover meaningfully.

US Treasury Yields
US Treasury yields rose sharply last week, with the two-year yield, which is particularly sensitive to monetary policy expectations, climbing approximately 34 basis points to around 4.86%.

This put the two-year yield on track for its largest weekly increase since September 2024.

The rapid rise in short-term yields reflects a significant repricing of the expected interest rate path over the coming months.

It has also intensified valuation pressure on equities, gold and other risk-sensitive assets.

Market Outlook: November 16–20
Global financial markets are entering a particularly data-intensive week, with major economic releases, speeches from central bank officials, earnings announcements from leading AI-related companies, high-profile IPO developments and persistent geopolitical risks all converging.

The interaction of these catalysts will provide an important test of two dominant market narratives: the outlook for interest rates and the sustainability of the AI-driven bull market.

Geopolitical Inflation Risks and Federal Reserve Policy
The primary market theme this week is the prospect that geopolitical tensions could keep inflation elevated for longer, particularly as a series of Federal Reserve officials prepare to deliver policy remarks.

Against this backdrop, expectations of persistently high interest rates could trigger sudden and significant market moves.

Following the resumption of Russia-Ukraine negotiations, a US special envoy travelled to Moscow to meet President Vladimir Putin. However, European governments have struggled to agree on a unified negotiating representative, exposing significant divisions within the proposed diplomatic framework.

These differences suggest that a substantive peace agreement is unlikely to be reached in the near term.

Meanwhile, tensions involving Iran remain elevated.

A report from the International Atomic Energy Agency confirmed that Iran continues to refuse cooperation with nuclear inspections. Iran's Assembly of Experts has also publicly called for consideration of withdrawal from the Nuclear Non-Proliferation Treaty as a means of strengthening the country's strategic deterrence.

These developments indicate that geopolitical risks in the Middle East have not meaningfully subsided.

Persistent uncertainty surrounding energy supplies could keep oil prices supported and limit their downside, potentially prolonging the process of bringing inflation back under control.

Key US Economic Data and Rate Expectations
This week's US retail sales figures, Federal Reserve meeting minutes and a series of speeches by Fed officials will be central to market expectations for monetary policy.

If retail spending proves more resilient than expected, particularly against a backdrop of elevated energy-related geopolitical risk premiums, markets could quickly revise terminal interest rate expectations higher.

Such a shift would likely push US Treasury yields upwards and weigh on risk assets more broadly, with highly valued growth stocks particularly vulnerable.

This represents the most important macroeconomic risk for investors to monitor this week.

Corporate Earnings and Major International Events
Beyond monetary policy and geopolitical developments, several major events could influence market sentiment.

The 33rd Asia-Pacific Economic Cooperation (APEC) Economic Leaders' Meeting is scheduled to take place in Shenzhen on November 18–19.

Meanwhile, major US retailers, including Walmart, Target and Home Depot, are due to release their earnings results.

These reports will provide additional insight into the strength of US consumer spending and help investors assess whether the underlying economy remains resilient despite elevated interest rates and persistent inflationary pressures.

Earnings announcements from major AI-related companies and developments surrounding high-profile IPOs will also be closely watched for signals about the sustainability of the technology sector's growth expectations.

Conclusion
Overall, market volatility is expected to increase significantly over the coming week.

In the near term, investors are likely to focus first on the hawkish risks arising from geopolitical inflation pressures and Federal Reserve commentary, followed by market reactions to AI-related earnings and IPO developments.

Under the base-case scenario, expectations of persistent inflation are unlikely to fade quickly, leaving interest rates more vulnerable to upward pressure than downward adjustments.

However, if Nvidia delivers weaker-than-expected guidance or Anthropic's IPO falls short of market expectations, negative sentiment across the AI sector could create an offsetting force. A deterioration in growth-stock sentiment could, in turn, constrain the Federal Reserve's scope for additional hawkish tightening.

Markets may consequently remain caught between these competing forces, producing frequent reversals and heightened volatility.

In an environment characterised by weaker risk appetite, investors may temporarily reduce exposure to highly valued AI stocks while awaiting greater clarity from corporate earnings and management guidance.

At the same time, if geopolitical tensions continue to intensify, traditional safe-haven assets such as US Treasuries and the US dollar could attract renewed demand and receive support in the near term.