EU CONSUMER CYCLICALS: VF Corp: 3Q Results

Today’s near-5% pullback in silver helps the gold/silver ratio back to ~59, off 12-year lows of 54 registered overnight. Thinner trading conditions over the Christmas-New Year period will be contributing to price swings intraday, with more focus on how the metals complex fares in January when the bulk of market participants return to their desks. Some have cited profit taking/tax selling as a bearish risk to monitor in the coming weeks. 

• The chart below highlights the surge in silver ETF inflows through December, including a 533-tonne inflow on December 23. Several narratives have been touted as drivers of the recent rally (e.g London physical market stress, Chinese export restrictions, industrial supply-demand imbalances and ongoing geopolitical tensions), incentivising participation from retail accounts.
• Gold ETF inflows have also increased in recent weeks, but to a much lesser extent relative to historical averages.

Figure 1: Gold/Silver Ratio Quarterly Chart (Source: Bloomberg Finance L.P)

Figure 2: Gold and Silver ETF Inflows

Risk sentiment turning to the downside as European trade resumes after the holiday period supports the low-yielding JPY and CHF. Meanwhile, this is now weighing on the likes of NZD and AUD on top of a precious metals selloff after Friday's rally.

• AUDUSD is lower at typing, however the price saw fresh highs overnight, reinforcing bullish conditions after the pair has cleared key resistance at 0.6707. This puts sights on 0.6759, the Oct 11 2024 high. NZDUSD meanwhile pares further from 0.5853 highs seen on December 24.
• The EUR is largely unfazed by a fresh set of headlines around US - Ukraine talks as at present, there is little to suggest any significant developments. A Trump-Putin call, scheduled in "nearest time", will likely be the next input here, where it remains to be seen if the US is able and willing to put significant pressure on Moscow to agree to the new 20-point peace framework.
• Despite the lack of material EUR support from this, EURUSD is heading for a strong close of the year as the Dollar Index is consolidating recent losses around the 98.00 handle, below which it closed for the first time since October last week.
• NOKSEK remains at a key technical juncture ahead of tomorrow's Norges Bank's January FX transactions release. Strong support at the April 9 low of 0.9065 contained downside earlier this month, after Norges Bank’s December MPR rate path was more hawkish than expected. However, the trend condition in the cross remains bearish, with rallies short of the 20-day EMA at 0.9197 considered corrective. Norges is expected to step up NOK purchases in 2026, a combination of lower petroleum revenues and continued government transfers to limit bank reserve growth. Given thin holiday season liquidity, the announcement could spur some temporary volatility in NOK crosses.
• The calendar remains light for the rest of the day, with US November NAR pending home sales as well as the Dallas Fed manufacturing activity the only notable datapoints. There are no ECB, BoE, or Fed speakers scheduled for the rest of the day.

Click here to access the indicative 2026 sovereign rating review schedules across the five most prominent rating agencies (Fitch, Moody's, S&P, Morningstar DBRS & Scope Ratings).

• Note that the schedules are indicative only and ratings can be reviewed on an ad-hoc basis.
• Rating agencies may also adjust their schedules during the year.