As global economies navigate a maze of fiscal pressures, political intrigue, and shifting trade winds, the week of November 13, 2025, has proven to be a pivotal moment for several major currencies and international negotiations. From Ottawa to London, Washington to Zurich, the interplay of government budgets, labor market jitters, and tariff disputes is shaping the economic landscape—and not always in predictable ways.
Canada, long admired for its fiscal discipline, has found itself under the microscope after Fitch Ratings issued a stark warning about the nation’s financial trajectory. According to Fitch, the Canadian government’s latest federal budget reveals a "significant erosion of federal finances," with the deficit forecast to balloon to CAD 78.3 billion, or 2.5% of GDP, by fiscal year 2025–26. This is not just a number on a spreadsheet: it’s substantially higher than both the median for other ‘AA’ rated countries and Canada’s own pre-pandemic benchmarks. The agency’s assessment, as reported by Bloomberg, highlights that Canada’s general government gross debt is set to reach 98.5% of GDP by 2027—nearly double the ‘AA’ median.
Fitch’s skepticism goes further, casting doubt on the government’s new fiscal rules, which pledge a balanced operating budget by 2028–29. The agency describes these rules as "non-binding" and points to a "track record of upward deficit revisions," arguing that previous fiscal guideposts have often been disregarded. This, Fitch contends, places Canada’s finances at a "high risk of further deterioration," making the new commitments appear largely unreliable.
Despite these fiscal headwinds, the Canadian Dollar (CAD) has shown surprising resilience in currency markets. A weaker US Dollar and a positive October jobs report provided some lift, with the Loonie climbing as high as 1.414 before settling around 1.40. Yet, as reported by Convera’s Market Insights team, the employment gains were largely concentrated in part-time jobs, raising questions about the underlying strength of the labor market. Looking ahead, the trajectory of the CAD is expected to closely shadow developments south of the border, as US macro data resumes its central role in driving currency direction.
The US, for its part, has just emerged from the longest government shutdown in its history, with federal operations set to continue—at least temporarily—until January. However, the shutdown’s ripple effects are still being felt. The US administration has confirmed that the October Consumer Price Index (CPI) report will not be published, citing data collection disruptions. This means that markets are flying somewhat blind, relying on alternative indicators like ADP and Challenger reports to gauge labor market health. According to Goldman Sachs, whenever the official figures are published, a decline of 50,000 in October payrolls is anticipated, reflecting a labor market clouded by uncertainty and disrupted data collection.
Meanwhile, the euro continues to tread water. The EUR/USD pair is struggling near its 21-day moving average, just below $1.16, with traders waiting for the resumption of key US data releases to provide fresh momentum. As noted by Convera, both rallies and pullbacks in the pair have remained contained, and unless growth differentials between the euro area and the US narrow, the bullish case for the euro may struggle to gain traction. While fiscal stimulus in Europe could support GDP next year, ongoing political uncertainty in France and a modest improvement in European economic data flow have kept the euro’s gains in check. Interestingly, the US Federal Reserve is easing policy later than the European Central Bank, and current market pricing expects the Fed to cut rates three times next year. If this scenario plays out, it could support a yield-driven bullish view on EUR/USD, but much depends on growth outcomes aligning with policy expectations.
Elsewhere in the currency universe, the Mexican Peso has staged a robust recovery. The USD/MXN pair failed to break above 18.6 and has now retreated to trade close to its 2025 low of 18.2. This rebound has been fueled by a risk-on environment, with improved investor appetite for emerging-market assets following US lawmakers’ progress toward ending the government shutdown. While domestic Mexican data, such as September’s industrial production, met expectations, it’s the positive global sentiment that has really bolstered the Peso.
Across the Atlantic, the British Pound has not been so lucky. Political drama in the UK escalated on November 13, 2025, with reports of a potential leadership challenge against Prime Minister Keir Starmer. Health Secretary Wes Streeting dismissed the rumors as “self-destructive behavior” from anonymous sources, but the discord has heightened concerns about the government’s ability to address looming economic and financial challenges—especially with the Autumn Budget set for November 26. The political turmoil has fed into a risk premium, pushing sterling lower and leaving it exposed on both fundamental and sentiment fronts. UK GDP data added to the gloom: growth was just 0.1% in the three months to September, with a 0.1% contraction in September itself. As a result, EUR/GBP has breached 0.88, reaching its highest levels in nearly three years, and near-term targets are now set at 0.8870–0.8900.
Amid these currency swings and political sagas, trade tensions are also making headlines. On November 13, 2025, Swiss Economics Minister Guy Parmelin arrived in Washington for ongoing tariff talks with US trade representative Jamieson Greer. According to Swissinfo, while a conclusion to the negotiations was considered "somewhat unlikely" that day, Bloomberg reported that Switzerland was close to a deal to reduce punitive US tariffs on Swiss goods from 39% to 15%. Since early August, Swiss exports—making up over 70% of the nation’s GDP—have faced a 39% US tariff, while the EU only faces 15%. A breakthrough would be a major relief for Swiss exporters and a sign that persistent business advocacy is bearing fruit. As of now, an agreement is expected in the coming days or weeks, but the final details remain in flux.
Finally, the commodity markets have not escaped the volatility. Oil prices, as measured by WTI, broke below $60 again during this period, reflecting both global demand concerns and the ongoing uncertainty in financial markets.
In a world where fiscal promises are scrutinized, political allegiances shift rapidly, and trade negotiations hang in the balance, the coming weeks promise more twists and turns. For now, policymakers and investors alike are bracing for whatever comes next.
