SummaryBOJ’s Ueda signalled readiness to continue raising ratesFurther tightening depends on growth and inflation tracking forecastsWage–price cycle seen as increasingly sustainableMonetary adjustment framed as supportive of long-term growthSignals reinforce Japan’s exit from deflation-era policyBank of Japan Governor Kazuo Ueda reinforced expectations of further policy normalisation, signalling that the central bank is prepared to continue raising interest rates provided economic and inflation conditions evolve broadly in line with its forecasts. His comments underline growing confidence within the BOJ that Japan is finally exiting its long deflationary era and transitioning toward a more durable, growth-driven model.Ueda said the BOJ expects to keep adjusting the degree of monetary support as the outlook for growth and prices improves. He stressed that gradual reductions in accommodation would help entrench sustainable economic expansion, rather than undermine it — a clear rebuttal to lingering concerns that tightening could choke off momentum.Crucially, Ueda said he expects Japan’s economy to maintain a virtuous cycle in which wages and prices rise moderately together. This wage–price dynamic has long been the BOJ’s missing link, and Ueda’s confidence suggests policymakers believe recent wage gains are no longer transitory but increasingly structural. Labour market tightness, demographic constraints and shifting corporate behaviour are now seen as reinforcing forces behind steady wage growth.The remarks align with comments earlier in the session from Finance Minister Taro Katayama, who described Japan as being at a “critical stage” in its shift away from deflation toward a growth-led economy. While Katayama focused on the broader economic transition, Ueda’s comments provided the clearest signal yet that monetary policy will continue to move in a less accommodative direction if conditions allow.Markets have been watching closely for confirmation that the BOJ’s December move marked the start of a sustained normalisation cycle rather than a one-off adjustment. Ueda’s language strongly suggests the former. By explicitly linking future rate hikes to forecast-consistent growth and inflation outcomes, the governor reaffirmed the BOJ’s data-dependent but forward-leaning stance.Taken together, the comments reinforce expectations that Japan’s ultra-loose monetary era is drawing to a close. While Ueda continues to emphasise gradualism and caution, his confidence in the wage–price cycle indicates the threshold for further tightening is lower than in previous years. For markets, the message is clear: as long as the economy behaves as the BOJ expects, policy rates are likely to keep moving higher, albeit at a measured pace. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Economists see inflation remaining sticky through 2026Growing risk of RBA rate hikes, possibly from FebruaryLate-2025 inflation rebound shifted policy expectationsHousing, services and labour-market tightness key driversForecasts now split between hikes, holds and cutsInflation is expected to remain uncomfortably persistent over the year ahead, increasing the likelihood that the Reserve Bank of Australia will be forced back into rate hikes, according to a survey of leading economists conducted by the Australian Financial Review (gated). A growing minority of forecasters now expect the RBA to raise interest rates as early as its first policy meeting of the year in February. Seven of the 38 economists surveyed, including teams at major lenders such as Commonwealth Bank of Australia, Citi and National Australia Bank, see a near-term hike as increasingly likely, citing signs that inflation pressures have re-emerged rather than faded.While the RBA cut the cash rate three times last year, in February, May and August, taking it to 3.6%, economists now argue that those moves may have been premature. Inflation, which had appeared to be easing, unexpectedly picked up late in the year, with headline CPI rising to 3.8% in October and core inflation accelerating to 3.3%, well above the RBA’s 2–3% target band.RBA Governor Michele Bullock added to the shift in expectations in December, warning that further tightening could not be ruled out if price pressures proved difficult to contain. Since then, financial markets have swung sharply, moving from pricing rate cuts to partially pricing hikes. Traders are now assigning a meaningful probability to a February increase and are fully pricing a hike by mid-year.Economists point to a combination of structural and cyclical pressures keeping inflation elevated. Housing and services costs remain firm amid chronic undersupply, rapid population growth, rising wages and higher energy costs. At the same time, unemployment remains near historic lows, supported by strong public-sector hiring, particularly across healthcare and the NDIS, and widespread labour hoarding by firms reluctant to shed staff after years of skills shortages.While views remain divided, the balance of risks has clearly shifted. A growing number of economists now expect at least two rate hikes this year, with some warning that if inflation fails to moderate convincingly, even further tightening may be required into 2026. This article was written by Eamonn Sheridan at investinglive.com.

Summary:China services PMI remained in expansion but slowed further in DecemberNew orders grew at the weakest pace in six monthsExport services demand slipped back into contractionJob shedding continued for a fifth straight monthBusiness confidence rose to a nine-month highChina’s services sector continued to expand in December, but the pace of growth slowed to its weakest level in six months, reinforcing signs that the post-pandemic recovery remains uneven and fragile despite improving sentiment toward 2026.The latest PMI data showed the RatingDog China General Services PMI easing slightly to 52.0 from 52.1 in November. While the index remained comfortably above the 50.0 threshold that separates expansion from contraction, the reading marked a fourth consecutive monthly deceleration in growth and highlighted ongoing demand and employment challenges.Business activity and new orders both continued to rise, supported by promotional activity and improved domestic customer interest. However, the rate of expansion in sales slowed to its weakest since June, as new export business slipped back into contraction. Companies cited reduced tourist inflows, particularly from Japan, as a key drag on overseas demand, underscoring continued volatility in external services activity.Labour-market conditions remained a notable weak spot. Services firms cut staffing levels for a fifth straight month, with the pace of job shedding the sharpest since September. Respondents pointed to cost pressures and ongoing restructuring efforts as reasons for workforce reductions, affecting both full-time and part-time employment. Reduced capacity contributed to a modest accumulation of backlogs, even as overall demand growth softened.Pricing dynamics continued to reflect deflationary pressures at the consumer-facing level. Input costs rose for a tenth consecutive month, driven by higher raw material and labour expenses, with inflation running at one of its faster rates of 2025. Despite this, intense competition limited pricing power, prompting service providers to cut output charges for the second time in three months in an effort to support sales.At the broader economy level, the China Composite PMI edged higher to 51.3 in December (prior 51.2), marking a seventh straight month of expansion. The increase was supported by both services growth and a renewed rise in factory output, although total new business expanded at the slowest pace in six months due to weaker export demand. Job shedding persisted at the composite level, while overall selling prices continued to fall despite rising costs.Encouragingly, business confidence improved markedly. Expectations for future activity climbed to a nine-month high, with firms increasingly optimistic that stronger market conditions, expansion plans, and policy momentum will support growth in 2026. Even so, ongoing employment contraction and external demand uncertainty remain key constraints on the near-term outlook. This article was written by Eamonn Sheridan at investinglive.com.

ICYMI:US attacks Venezuela, captures President MaduroHappy New Year, especially to Venezuelans! Monday early FX rates guideVenezuela - Goldman sees 2026 Brent at $56 & WTI at $52, flags longer-term downside risksAnd Trump later spoke:Trump claims control of Venezuela, warns Colombia and Mexico could be next-Gold and silver pushed sharply higher today as a cluster of macro, geopolitical and positioning forces aligned in favour of precious metals, reinforcing the broader bullish narrative that has been building into the new year. None of this is new (well, Venezuela is, but we've covered it extensively already). Markets continue to reassess the trajectory of US monetary policy. While the Federal Reserve continues to signal caution on the timing of further rate cuts, investors remain priced for easing later this year. That expectation, combined with softer inflation momentum and signs of labour-market cooling, has kept pressure on real yields, a key tailwind for non-yielding assets such as gold and silver.At the same time, geopolitical risk has escalated materially, providing a classic safe-haven bid. The US intervention in Venezuela, combined with President Trump’s increasingly confrontational rhetoric toward Colombia and Mexico, has raised concerns about regional instability in Latin America. These developments have come on top of already elevated global tensions, encouraging portfolio hedging and defensive positioning in precious metals.Central-bank demand remains another powerful structural support, particularly for gold. Ongoing diversification away from the US dollar by several reserve managers continues to underpin prices, reinforcing gold’s role as a neutral reserve asset at a time when geopolitical fragmentation and sanctions risk remain high.Silver, meanwhile, has been outperforming on a dual demand narrative. Alongside its safe-haven appeal, silver is benefiting from expectations of resilient industrial demand, particularly linked to electrification, solar energy and advanced manufacturing. As growth fears ease slightly and the outlook stabilises, silver tends to gain leverage to both macro reflation and risk hedging — a dynamic clearly on display today.Finally, technical and positioning factors amplified the move. Thin liquidity early in the year, combined with momentum-based buying and short-covering after recent consolidations, helped accelerate gains once key resistance levels were breached.Taken together, the rally reflects a market that is increasingly comfortable holding precious metals as both a hedge against geopolitical shock and a medium-term play on easier financial conditions, weaker real yields and structural demand growth, conditions that remain firmly in place. ---The gold chart above is the appetizer, silver looks like the mains: This article was written by Eamonn Sheridan at investinglive.com.

The People's Bank of China (PBOC), China's central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a "band," around a central reference rate, or "midpoint." It's currently at +/- 2%.The previous close was 6.9879.Today's mid-rate at 7.0230 is the strongest for the onshore yuan since 30 September 2024. People's Bank of China injects 13.5bn yuan via 7-day reverse repos in open market operations, rate remains 1.4%.The daily fixing of this mid-rate is often interpreted as a policy signal rather than just a technical reference point. A higher-than-expected USD/CNY midpoint is typically read as a sign the PBOC is leaning against CNY appreciation pressure, like today. In recent months, the People’s Bank of China has taken deliberate steps to moderate the speed of appreciation in the onshore yuan, signalling a preference for stability over sharp currency gains. Rather than targeting a specific level, policymakers appear focused on preventing an overly rapid rise in CNY that could disrupt trade, capital flows and domestic financial conditions. Yesterday USD/CNY fell below 7.0 for the first time since May 2023. The PBoC is slowing the appreciation of the yuan, but hasn't stopped it.---ICYMI from last week, piecemeal stimulus steps continue from China:China eases property taxes but avoids bold housing stimulus (property downturn drags on)China is extending a value-added tax (VAT) exemption on certain residential property sales, adding another incremental policy measure aimed at stabilising its long-running real estate downturn. While the move lowers transaction costs for homeowners, it underscores Beijing’s preference for targeted relief rather than more forceful intervention.China boosts consumer trade-in subsidies, expands scheme to digital products in 2026China is stepping up efforts to revive household spending, allocating fresh funding from ultra-long special treasury bonds to expand its consumer trade-in subsidy scheme. The programme, first launched in 2024, will be broadened in 2026 to include digital and smart products, as policymakers look to counter weak growth momentum and rebalance the economy toward consumption. This article was written by Eamonn Sheridan at investinglive.com.

Suymmary:Trump reaffirmed US control over post-Maduro VenezuelaUS says it is working with newly sworn-in leaders in CaracasWashington will not invest in Venezuela, despite oil company interestTrump floated the idea of an operation in ColombiaMexico also warned, with cartel power cited as justificationUS President Donald Trump escalated rhetoric across Latin America, reinforcing Washington’s assertion of control over post-Maduro Venezuela while openly signalling that Colombia and Mexico could also face US action as part of a widening campaign against criminal networks and regional instability.Trump reiterated that the United States is now effectively “in charge” of Venezuela following the weekend’s operation that removed former president Nicolás Maduro. US attacks Venezuela, captures President MaduroHappy New Year, especially to Venezuelans! Monday early FX rates guideVenezuela - Goldman sees 2026 Brent at $56 & WTI at $52, flags longer-term downside risksHe said US authorities are working with officials who were recently sworn in as part of a transitional arrangement, framing the intervention as an ongoing governance and security effort rather than a one-off military action. While Trump stressed that Washington will not invest public funds into rebuilding Venezuela, he acknowledged strong interest from private-sector energy companies, saying oil firms are eager to re-enter the country despite years of production decline and sanctions.The president’s remarks went further, however, by broadening the scope of US pressure beyond Venezuela. Asked about the possibility of an operation in Colombia, Trump said the idea “sounds good” to him, describing Colombia as “very sick” and blaming its condition on current leadership. He added pointedly that the situation would not persist for long, language widely interpreted as a warning that Colombia could face US action if Washington deems criminal or insurgent activity to be inadequately addressed.Trump also sharpened his tone toward Mexico, saying the United States “has to do something” and repeatedly criticising the strength of drug cartels operating there. He said he has offered on multiple occasions to send US troops to assist Mexico, claiming he raises the proposal every time he speaks with President Claudia Sheinbaum. According to Trump, Mexico must “get its act together,” arguing that cartel power represents a direct threat to US security.While no formal announcements were made regarding military action in Colombia or Mexico, the remarks mark a significant escalation in regional rhetoric following the Venezuela intervention. The combination of governance claims in Caracas and explicit warnings to neighbouring states suggests Washington is seeking to deter resistance while signalling a willingness to expand pressure across the region.For markets, the comments add a fresh layer of geopolitical risk across Latin America, with potential implications for energy investment, emerging-market FX volatility and regional risk premia. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Japan’s manufacturing PMI returned to neutral territory in DecemberNew orders fell at the slowest pace in 19 monthsOutput stabilised and employment growth accelerated modestlyInput prices rose at the fastest rate since AprilFirms remained cautiously optimistic heading into 2026Japan’s manufacturing sector showed clear signs of stabilisation at the end of 2025, with business conditions improving to their strongest level in more than a year, according to the latest S&P Global survey data. While demand remained subdued overall, the pace of decline in new orders slowed sharply, production stabilised, and employment continued to expand, signalling tentative momentum heading into 2026.The headline Japan Manufacturing PMI rose to 50.0 in December from 48.7 in November, marking the first reading at the neutral threshold in five months and ending a prolonged period of deterioration. The improvement was driven primarily by a much slower contraction in new business, which fell at its weakest pace in 19 months. Some manufacturers reported stronger-than-expected sales linked to new projects and improved customer spending.Output volumes were broadly steady, with production declining only marginally and at the slowest pace seen during the recent six-month downturn. Purchasing activity also fell at a reduced and only marginal rate, while inventory reductions continued as firms adjusted to muted demand. Stocks of finished goods declined at one of the fastest rates seen since 2020, reflecting cautious inventory management.Employment trends provided a further source of support. Manufacturers added staff for a fourth consecutive month, with job creation accelerating slightly as firms positioned for a potential recovery in demand. This helped reduce outstanding workloads, although the pace of backlog clearance eased to its slowest level in 18 months, suggesting capacity pressures are beginning to stabilise.Price dynamics, however, emerged as a key area of concern. Input costs rose at their fastest pace since April, driven by higher raw material prices, rising labour costs, and the impact of a weak yen on imported inputs. Delivery times continued to lengthen due to material shortages and shipping delays, though the deterioration in supplier performance remained modest. Faced with rising costs, firms passed on expenses to customers, lifting output prices at a solid pace in December.Business confidence remained positive despite slipping from November’s recent high. Optimism about the year-ahead outlook stayed above the long-run average, with firms expecting new product launches and improved demand — particularly across autos and semiconductors — to lift production in 2026. That said, manufacturers continued to flag risks from sluggish global growth, demographic pressures, and persistent cost inflation.---USD/JPY update: This article was written by Eamonn Sheridan at investinglive.com.

The People’s Bank of China is due to set the daily USD/CNY reference rate at around 0115 GMT (2115 US Eastern time), a fixing that remains one of the most closely watched signals in Asian foreign exchange markets. China operates a managed floating exchange rate system, under which the renminbi (yuan) is allowed to trade within a prescribed band around a central reference rate, or midpoint, set each trading day by the PBOC. The current trading band permits the currency to move plus or minus 2% from the official midpoint during onshore trading hours. Each morning, the PBOC determines the midpoint based on a range of inputs. These include the previous day’s closing price, movements in major currencies, particularly the US dollar, broader international FX conditions, and domestic economic considerations such as capital flows, growth momentum and financial stability objectives. The midpoint is not a purely mechanical calculation, allowing policymakers discretion to guide market expectations. Once the midpoint is announced, onshore USD/CNY is free to trade within the allowable band. If market pressures push the yuan toward either edge of that range, the central bank may step in to smooth volatility. Intervention can take the form of direct buying or selling of yuan, adjustments to liquidity conditions, or guidance through state-owned banks. As a result, the daily fixing is often interpreted as a policy signal rather than just a technical reference point. A stronger-than-expected CNY midpoint is typically read as a sign the PBOC is leaning against depreciation pressure, while a weaker fixing for the CNY can indicate tolerance for a softer currency, often in response to dollar strength or domestic economic headwinds.In periods of heightened global volatility, such as shifts in US rate expectations, trade tensions or capital flow pressures, the fixing takes on added significance. For investors, it provides insight into Beijing’s currency priorities, balancing competitiveness, capital stability and financial market confidence. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Yen weakened as the dollar opened the first full week of the new year on a firm footingUSD/JPY pushed back toward the upper end of recent rangesRate differentials continue to weigh on the Japanese currencyMarkets price more Fed cuts than policymakers currently signalUS data this week likely to help shape near-term FX directionThe Japanese yen underperformed at the start of the first full trading week of the year, slipping back toward recent lows as the US dollar opened on a firm footing across major currency pairs. Dollar strength was evident against the euro and sterling, but the move in USD/JPY was particularly notable, with the pair edging back toward the upper end of its recent range as yield differentials continued to favour the greenback.The dollar rose to around ¥156.90 ... and above 157.00 as I update .... extending gains against the yen as markets maintained a cautious stance on the near-term outlook for Japanese monetary policy. While the Bank of Japan has taken incremental steps toward policy normalisation, investors remain unconvinced that the pace of tightening will be sufficient to materially support the currency in the short term, particularly against a still-resilient US economy and potential Fed pause.Dollar strength elsewhere was more modest. The euro slipped toward $1.1705, its weakest level in more than three weeks, while sterling edged lower to around $1.3440. Overall currency moves were contained, though risk sentiment remained sensitive to geopolitical developments following the United States’ high-profile operation in Venezuela over the weekend.For yen traders, however, macro fundamentals remained, and will remain, the dominant driver. Markets continue to price in one or two interest-rate cuts from the divided Federal Open Market Committee. That gap in expectations has kept US yields elevated relative to Japanese rates, reinforcing downward pressure on the yen.Attention now turns to a heavy US data calendar that could further influence rate expectations and, by extension, USD/JPY. The week begins with the ISM surveys and culminates in Friday’s non-farm payrolls report, which will be closely watched for confirmation that US labour market momentum is easing in a way that would justify further Fed easing. Until clearer evidence emerges of a decisive slowdown in US activity, or a more assertive tightening signal from Tokyo, the yen is likely to remain vulnerable. The persistence of wide rate differentials, coupled with global investors’ preference for dollar exposure at the start of the year, suggests that rallies in the Japanese currency may continue to be shallow and short-lived. ---Nikkei update: This article was written by Eamonn Sheridan at investinglive.com.

Summary:Goldman Sachs left its near-term price forecasts unchanged, projecting average prices of $56 per barrel for Brent crude and $52 for West Texas Intermediate this year.Goldman sees limited near-term impact from Venezuela on oil pricesAny production recovery likely to be gradual and partialInfrastructure damage and underinvestment remain major constraintsNear-term Brent and WTI price forecasts unchangedLong-run downside risks increase from added global supplyProspects for a longer-term recovery in Venezuelan oil production could add to downward pressure on crude prices beyond the near-term horizon, according to Goldman Sachs, even as the bank cautions that any rebound would be slow, uneven and highly dependent on sustained investment.In a research note dated January 4 (via Bloomberg, gated), Goldman analysts said that while the recent US intervention in Venezuela has reshaped the country’s political outlook, it does not immediately alter oil market fundamentals. The bank expects any meaningful recovery in Venezuelan output to unfold only gradually, citing severely degraded infrastructure and years of underinvestment across the upstream sector. Analysts added that strong financial and policy incentives would be required to attract the scale of capital necessary to restore production capacity.Goldman emphasised that Venezuela’s oil industry has been in long-term decline, with output collapsing over the past two decades due to mismanagement, sanctions and infrastructure decay. As a result, Venezuela now accounts for less than 1% of global oil supply, significantly limiting its ability to influence prices in the short run. The bank therefore left its near-term price forecasts unchanged, projecting average prices of $56 per barrel for Brent crude and $52 for West Texas Intermediate this year.The assessment follows a dramatic escalation in geopolitical risk over the weekend, when the United States captured Venezuelan President Nicolás Maduro in a military operation that stunned global markets. While the political shock initially raised concerns about potential supply disruptions, Goldman noted that the intervention itself has not materially affected Venezuelan production or exports.Looking further ahead, however, the bank warned that a gradual return of Venezuelan barrels could add to a growing list of downside risks for oil prices in the latter part of the decade. Goldman pointed to stronger-than-expected production growth in both Russia and the United States, arguing that additional supply from Venezuela would further loosen balances in the outer years of its forecast horizon.Taken together, the analysts said these dynamics increase the risk that oil prices could face sustained pressure from 2027 onwards, particularly if global demand growth softens and investment elsewhere continues to surprise to the upside. While Venezuelan supply is unlikely to be a decisive factor in the near term, Goldman concluded that it reinforces a structurally more bearish long-run outlook for crude markets. This article was written by Eamonn Sheridan at investinglive.com.

Good morning, afternoon or evening to all ForexLive traders and welcome to the start of the back from holidays FX week!Some of us will have unpacked the car after a week or so at the beach and what have you. Some of us will have invaded Venezuela. Big news to open the year, summary:US forces carried out a surprise, large-scale operation to seize Venezuelan President Nicolás MaduroThe mission involved roughly 150 aircraft and disabled Caracas’ air defencesMaduro was detained at his residence and flown to a US aircraft carrier within hoursHe was later transferred to New York after Trump publicly confirmed the capture Early FX pricing shows limited market response, so far at least: EUR-USD 1.1724 USD-JPY 156.81GBP-USD 1.3462AUD-USD 0.6679 USD-CAD 1.3741USD-CHF 0.7918 NZD-USD 0.5760The operation sharply raises geopolitical risk across Latin America, with potential spillovers into oil markets. Globex will open in around 2 hour, at 6pm US Eastern time, 2300 GMT. Before adding more detail on Venezuela events, my usual caveat on early pricing ... As is usual for a Monday morning, market liquidity is very thin until it improves as more Asian centres come online ... prices are liable to swing around, so take care out there. -After months of escalating pressure on Caracas, US forces launched a highly coordinated operation that resulted in the seizure of Venezuelan President Nicolás Maduro in the early hours of Saturday morning. The operation, codenamed Absolute Resolve, followed a prolonged period of military build-up in the Caribbean and repeated warnings from Washington over Maduro’s alleged role in drug trafficking to the United States.According to US officials, the mission was the culmination of months of planning and rehearsal. Around 150 aircraft took off from roughly 20 airbases across the region, forming the backbone of a rapid strike designed to neutralise Venezuelan defences and extract the country’s leader within a tightly controlled timeframe. General Dan Caine, chairman of the Joint Chiefs of Staff, said the operation had been rehearsed extensively to ensure speed and precision.In the opening phase, US forces disabled Venezuela’s air-defence and communications systems. President Donald Trump later claimed that Caracas was plunged into widespread darkness due to what he described as US “technical expertise”, though no further details were provided. Residents in the capital reported a series of loud explosions as the initial strikes unfolded.At 2:01am local time, US helicopters landed at Maduro’s residence in Caracas. Maduro and his wife were taken into custody, though US officials have not confirmed whether there was any exchange of fire or resistance during the operation.Just over two hours later, at 4:29am, Maduro was transferred to a US aircraft carrier, the USS Iwo Jima, and flown toward the United States. Trump later posted an image on his Truth Social account showing the Venezuelan leader blindfolded and dressed in a grey tracksuit.Following his departure from the carrier, Maduro was escorted on a flight that landed at Stewart Air National Guard Base in New York later that afternoon. The operation marks one of the most dramatic US interventions in Latin America in decades and is likely to have far-reaching geopolitical, legal, and market implications. By the time you've read down here some of the rates have changed, its thin and scatty out there! This article was written by Eamonn Sheridan at investinglive.com.

Sun: OPEC+Mon: European Epiphany holiday (No After-Hours Trading in Italy); UK Mortgage Approvals/Lending (Nov), US ISM Manufacturing PMI (Dec), Final PMIs (Dec)Tue: European Epiphany holiday (No After-Hours Trading in Italy); French & German Prelim HICP (Dec), EZ Final PMIs (Dec), UK Final PMIs (Dec)Wed: Australian CPI (Nov), German Retail Sales (Nov), Unemployment (Dec), Chinese FX Reserves (Dec), EZ Flash HICP (Dec), US ADP (Dec), ISM Services (Dec), JOLTS (Nov)Thu: SNB Minutes (Dec); German Industrial Orders (Nov), Swedish Flash CPIF (Dec), Swiss CPI (Dec), EZ Producer Prices (Nov), Consumer Confidence Final (Dec), US Weekly Claims (w/e 27th Dec), Chinese Trade Balance (Dec)Fri: German Industrial Production (Nov), Norwegian CPI (Dec), EZ Retail Sales (Nov), US NFP (Dec), Canadian Jobs (Dec), US Uni. of Michigan Prelim. (Jan)Fed Chair Nominee (TBC): US President Trump has suggested that he will name the successor to Fed Chair Powell early in 2026, CNBC reported the first week of January. The list of candidates has greatly narrowed from the 12 candidates initially. For the most part, NEC Director Hassett was seen as the clear favourite to replace Powell. However, in recent weeks, several reports have suggested that insiders are recommending against appointing Hassett as Fed Chair, and his lead as favourite has diminished somewhat. President Trump again reiterated criticism of current Fed Chair Powell for cutting rates too slowly, calling him a fool; Trump also repeated claims that Fed HQ renovations cost USD 4.1bln (others have suggested it is around USD 2.5bln), threatening a lawsuit, and saying he would love to fire Powell. The four candidates are: NEC Director Hassett (Polymarket has him as favourite, at 41%), former Fed Governor Warsh (Polymarket's second favourite, at 32%), Fed Governor Waller (15%) and BlackRock's Rick Rieder (4%). Waller is the only internal candidate. Powell’s chair term expires in May 2026. To read the full preview, please click here.OPEC+ (Sun): OPEC+ is expected to reaffirm its production pause through Q1, maintaining the halt to further supply increases, according to Bloomberg sources. The stance reflects concerns over a looming global oversupply backdrop, with crude prices sharply lower over 2025 and forecasters warning of a potential glut in 2026. Delegates indicate little appetite to resume hikes at this stage, according to reports. Recent Saudi–UAE geopolitical tensions have generated headlines but are widely viewed as noise rather than a threat to OPEC cohesion, with no expectation that they will spill over into production policy.ISM Manufacturing PMI (Mon):As a basis of comparison, S&P Global's flash PMI data for December showed US manufacturing activity continued to expand in December, but momentum weakened. Output growth slowed to a three-month low, and overall PMI eased to 51.8, the weakest in five months. New orders fell for the first time in a year, signalling softening demand despite firms maintaining higher production levels. Backlogs declined, and input buying was cut, while inventories of unsold goods accumulated again. Looking ahead, S&P said that the outlook has become more cautious: lower sales raise concerns that current production levels are unsustainable unless demand recovers, while elevated costs linked to tariffs and supply delays continue to weigh on confidence.ISM Services PMI (Wed): As a basis of comparison, S&P Global's flash PMI data for December showed services activity expanding in December but at a notably slower pace. The business activity index fell to a six-month low, with growth in new business slipping to its weakest in 20 months, pointing to cooling demand across the sector. Employment growth nearly stalled as firms became more cautious. The outlook remains positive but has deteriorated slightly, sitting below the long-run average, S&P said. Rising input costs and sharply higher prices charged—partly blamed on tariffs and labour costs—are eroding confidence, although hopes of policy support and lower interest rates provide some offset.Australian CPI (Wed): The previous release showed CPI at 3.8% Y/Y in October, up from 3.6%, with the trimmed-mean (RBA’s preferred inflation gauge) at 3.3% Y/Y — both measures above the RBA’s 2–3% target band. Inflationary pressures have lingered late in 2025, contributing to the ongoing debate around the RBA’s policy outlook for 2026. Recent RBA narrative suggested that higher electricity prices due to the end of government rebates are biasing the annual inflation rate higher into mid-2026, and that policymakers have signalled they are prepared to reconsider rate moves if inflation does not subside.EZ Flash HICP (Wed): Investec expects Eurozone inflation to remain in a “good place”, with headline HICP seen dipping 0.1pp to 2.0% Y/Y, exactly in line with the ECB’s target, while core HICP is forecast unchanged at 2.4% Y/Y. Disinflation is expected to be driven primarily by lower fuel prices, alongside a partial unwind of November’s softness in non-energy goods and firmness in services. That said, services inflation will remain closely watched by the ECB given firmer-than-expected wage growth, while authorities are also monitoring potential trade diversion effects from Chinese exports, which have so far had a limited impact on consumer prices.SNB Minutes (Thu): In December, the SNB maintained its policy rate at 0.00%, as expected, and reiterated its willingness to be active in the FX market as necessary. On the economy, the SNB maintained its inflation forecast for 2025 but sharply cut its 2026 projection to 0.3% from a previous forecast of 0.5%. At the subsequent press conference, Chairman Schlegel reiterated that the bank stands ready to intervene in the FX market and, more notably, said he could not say that a lower CPI outlook makes NIRP more likely. From the minutes, attention will be on further detail around the inflation forecasts and whether Schlegel’s view on NIRP is shared by the board as a whole.Swedish Flash CPIF (Thu): November’s reading came in cooler than expected at 2.3% Y/Y (exp. 2.5%, prev. 3.1%). Thereafter, the one-year money-market view fell to 1.6% from 2.1%, while the five-year view was maintained at 2.1%. In December, the Riksbank maintained its policy rate at 1.75%, as expected. On inflation, the Riksbank said that while there have been some month-to-month variations, inflation has overall developed in line with forecasts and is around the 2% mark. Looking ahead, the Riksbank maintained the view that it expects rates to remain at this level for some time; as such, the December inflation data is unlikely to alter this assessment.Swiss CPI (Thu): November’s print was 0.0% Y/Y, following 0.1% in October. The Q4 2025 average forecast, as of the December statement, is 0.1%, down from a previous forecast of 0.4%, implying a December print of around 0.2%. While the release will draw attention, the primary focus remains on the medium-term outlook, which the SNB described as only “little changed” in December versus September. Crucially, CPI is expected to remain within the 0–2% target range for the entire forecast horizon. In the near term, Chairman Schlegel has arguably taken some of the sting out of any cooler-than-expected print, saying he cannot say that a lower CPI outlook makes a return to NIRP more likely.Chinese Inflation (Fri): CPI Y/Y for December is expected to tick lower to 0.6% from 0.7%, whilst PPI is expected to remain at -2.2% Y/Y. In November, China’s consumer inflation rose to 0.7% Y/Y, marking a 21-month high driven largely by food prices, while factory-gate prices (PPI) remained weak with a -2.2% Y/Y decline, underscoring persistent deflationary pressures amid weak domestic demand. Domestically driven price pressures have struggled to gain momentum despite recent policy support, and producer deflation has persisted for an extended period, reflecting ongoing slack in factory activity and weak global demand.Norwegian CPI (Fri): November’s CPI showed core inflation at 3.0% Y/Y (exp. 3.1%, prev. 3.4%), while the headline rate was 3.0% Y/Y (exp. 2.7%, prev. 3.1%). For December, Norges Bank forecasts core inflation at 3.0% and the headline at 2.9%. Inflation in Norway is somewhat more pertinent than for its Scandinavian peers, as Norges Bank expects to ease the policy rate over the course of 2026, with the rate seen averaging 3.9% in 2026 and 3.4% in 2027, versus the current 4.00%. However, the December data are unlikely to materially alter the narrative that a cut could become possible from mid-2026, depending on developments in CPI and the NOK. As a reminder, Governor Bache struck a hawkish note in December, making clear the bank is in no hurry to cut.Canadian Jobs (Fri): The December jobs report will be in focus to see if the strength seen in recent months, particularly November, continues. In November, the unemployment rate fell to 6.5%, marking three months of solid employment growth. The BoC Minutes noted that while this was a sign the labour market was improving, a broader set of indicators showed a mixed picture. “After large job losses over the summer, employment in the sectors most exposed to trade had stabilised at a lower level than before the trade conflict. Other sectors, particularly services, had boosted overall employment in recent months”. Meanwhile, the BoC said that much of the recent hiring was in part-time jobs, and highlighted that vacancies were low and surveys of businesses indicated hiring intentions were subdued. The strong labour market reports recently have seen markets price in rate hikes now from the BoC. There is currently c. 20bps of hikes priced by year-end, implying a 76% probability of a 25bps hike.US Jobs Data (Fri):Expectations are currently for the December jobs report to show 55k jobs added, slowing from the prior 64k, with the unemployment rate expected to tick down to 4.5% from 4.6%. The December jobs data is expected to be relatively easier to interpret, following the October (headline -105k) and November (+64k) readings. Analysts suggest that October's large decline in federal worker payrolls (-162k) was a one-off, and November's data showed a more modest decline (-6k). Analysts also expect that November's government shutdown will have a diminished impact on the data. The December jobs data will ultimately be used to set expectations of how the Fed will conduct its monetary policy in January, following the recent softer-than-expected CPI data and resilient economic growth data, which many analysts see as an argument that the Fed may pause. The latest FOMC meeting minutes showed a finely balanced decision, with most participants backing a cut to 3.50–3.75% due to rising downside risks to employment, while some preferred no change, and one favoured a larger move (nine members voted for a 25bps rate cut; Miran voted for a 50bps reduction; Goolsbee and Schmid voted for unchanged). Most judged further cuts are likely if inflation declines, but several favoured holding rates steady to assess lagged effects. Inflation was seen above 2%, with tariff-related pressures noted, and risks were judged as tilted to the upside. Participants noted that labour markets were softening, growth was moderate, and balance-sheet management was focused on maintaining ample reserves. Analysts said the minutes underline a clear split within the Fed, reinforcing a cautious policy outlook. While the majority remain open to further easing, confidence is explicitly conditional on clearer disinflation, particularly given concerns that additional cuts could undermine commitment to the 2% target. The emphasis on a pause to assess lagged effects signals sensitivity to policy transmission risks. Softer labour conditions justify the recent cut, but persistent inflation uncertainty and tariff effects argue against near-term follow-through, leaving policy firmly data-dependent rather than on a preset course. Barclays said the minutes showed support for a December rate cut and further easing if inflation declines, but revealed divisions over the future rate path and timing. The bank writes that the minutes suggest a likely pause at the January meeting while the FOMC assesses the effects of recent cuts, noting that participants remained concerned about inflation, saw the labour market softening, and viewed growth as resilient.This article originally appeared on Newsquawk. This article was written by Newsquawk Analysis at investinglive.com.

The US launched military operations in Venezuela and captured President Nicolas Maduro and his wife. Images from the country showed multiple strikes and fires. US President Trump announced that Madura was captured.An executive from state oil company PDVSA said the La Guaira port was severely damaged but that oil facilities were unscathed. Trump We will wait to hear what Trump has to say about the plans for what comes next but in December he talked about the 2007 seizure of some assets from American oil companies and that his intention was "getting land, oil rights, whatever we had" returned."They took it away because we had a president that maybe wasn't watching. But they're not going to do that again.""We want it back," he said. "They took our oil rights — we had a lot of oil there. As you know they threw our companies out, and we want it back."Russia responded to the reports saying that if actions took place "constitute an unacceptable violation of the sovereignty of an independent state".US Senator Mike Lee said he spoke with Secretary of State Marco Rubio who said "Maduro has been arrested by US personnel to stand trial on criminal charges in the United States, and that the kinetic action we saw tonight was deployed to protect and defend those executing the arrest warrant."The EU foreign affairs representative Kaja Kallas said:I have spoken with Secretary of State Marco Rubio and our Ambassador in Caracas. The EU is closely monitoring the situation in Venezuela. The EU has repeatedly stated that Mr Maduro lacks legitimacy and has defended a peaceful transition. Under all circumstances, the principles of international law and the UN Charter must be respected. We call for restraint. The safety of EU citizens in the country is our top priority.For markets, this might be a short-lived event but that could change quickly depending on how Venezuela responds. My guess is that America had local help and there is some kind of coup underway, otherwise Maduro will be replaced by deputies. In terms of markets, Venezuela has massive oil reserves but its production and exports are less than 1 million barrels per day and have been disrupted recently anyway. What could be more concerning is the message this sends in Latin America and how China and Russia respond. This article was written by Adam Button at investinglive.com.

Sector OverviewThe stock market witnessed a notable rally today, with the semiconductor sector leading the charge. Key players like Nvidia (NVDA) and Advanced Micro Devices (AMD) surged by 2.02% and 3.63% respectively, reflecting robust investor confidence in tech hardware advancements.? Technology: Broad gains were observed with companies like Oracle (ORCL) and Palantir (PLTR) climbing up by 1.44% and 1.12%.? Consumer Cyclical: The sector stayed bullish with leaders such as Amazon (AMZN) and Tesla (TSLA) rising by 0.84% and 1.80% respectively.? Financial: It was a mixed day in financials, with JPMorgan Chase (JPM) posting a modest gain of 0.14%, whereas Visa (V) slightly fell by 0.58%.? Healthcare: Sectors like healthcare showed minor setbacks with Eli Lilly (LLY) slipping by 0.46%.Market Mood and TrendsOverall, the market sentiment was bullish, primarily fueled by the impressive performance in the tech industry. The ongoing investor optimism in tech upgrades and innovations propelled this momentum. On the other hand, caution remains in the financial sector, reflecting uncertainties around economic policies.Strategic RecommendationsAmidst this surge in the tech sector, investors are recommended to keep a balanced approach toward their portfolios. Here are some strategic insights:✨ Focus on Technology: With semiconductors showing strength, tech appears promising for both short-term momentum and long-term growth.? Monitor Financial Sector: Given the mixed performance, it's wise to keep an eye on economic indicators that could shift dynamics within financial stocks.? Diversify Across Sectors: To mitigate risks, diversifying investments can safeguard against potential volatility in the healthcare and consumer defensive sectors.As always, keeping abreast of market data and analyses is crucial for strategic planning. Stay updated with InvestingLive.com for ongoing insights and personalized advice. This article was written by Itai Levitan at investinglive.com.

The Canadian manufacturing sector remains stuck in the mud as the final Canadian S&P Global survey of manufacturers was released. It’s another soft reading for the Canadian economy, and the details here are painting a stagflationary picture that the Bank of Canada isn't going to like.Here are the details from the S&P Global Manufacturing PMI for December:48.6 vs 48.4 prior.Output Index: Declined at a quicker rateNew Orders with a 'solid decline'Employment: 11th consecutive month of job shedding.Prices: Selling price inflation hit a six-month high.The report explicitly blames tariffs for driving up prices while simultaneously killing demand. Fortunately, the consumer side of the economy has remained strong as manufacturing gets left behind. A year of prolonged uncertainty around USMCA negotiations isn't going to help.Firms reported that average lead times lengthened because of customs delays, specifically with US imports. Even worse, the uncertainty around trade policy is causing a "general air of uncertainty" that is weighing on output for the year ahead, something that will hit capexPaul Smith, Economics Director at S&P Global:“Canada’s manufacturing economy ended the year on a subdued note, with output and new orders both falling again – as they have done in each month of 2025 apart from January. Once again, tariffs remained an important theme amongst PMI survey respondents, with a general air of uncertainty continuing to negatively weigh on current and expected output levels for the year ahead. “This means firms remain naturally cautious, and seeking an operating leanness, either in terms of labour capacity or inventory holdings. Purchasing activity was also cut again in December, although supply-chain delays continue, and the price of inputs shifted higher – which firms once again closely linked to tariffs.” This is a reminder that there are problems in Canadian manufacturing as this survey has been in contraction for 11 straight months, shedding jobs the whole way down. Normally, that would scream for more cuts but look at the inflation component: Input price inflation picked up, and selling price inflation is at a six-month high. Firms are passing those tariff costs right along to consumers.USD/CAD is up 16 pips on the first real trading day of 2026 after falling about 5% last year.Yesterday, I wrote a Canadian dollar outlook for 2026 and later today I will be on BNNBloomberg TV talking about it. This article was written by Adam Button at investinglive.com.

Markets won't be back in full swing until next week but we're getting a bit of a teaser of what the focus will be today already. US futures are running higher but it is once again commodities that are hogging the spotlight, in particular precious metals. After melting higher in December, we're starting to get a taste of that again to start the new year with both gold and silver running up today.The former is up nearly 2% to $4,393 with the latter up over 4% to $74.38. The gains have largely been sustained in European morning trade, with buyers not getting too carried away just yet amid quieter trading. In part, the technicals are also hinting at some near-term resistance perhaps despite all the heat.As indicated by the charts above, both gold and silver are running up to contest their respective 100-hour moving average (red line) now.The silver chart looks more promising after buyers looked to have put on a defense around the 200-hour moving average (blue line) after the latest pullback from the post-Christmas highs.As for gold, its own 200-hour moving average (blue line) now acts as a second near-term resistance layer in limiting the upside. But if buyers can clear the $4,400 mark, it will be a good first step in reestablishing momentum to chase back the recent highs above $4,500 to start the new year.The seasonal strength for gold in December played out accordingly and what is scary is that January promises to be an even stronger seasonal month for the precious metal. You can check out the seasonal pattern here, where January has historically been the best month for gold over the past two decades.If that is any indication for the start of 2026, precious metals might still have scope to travel higher before meeting the point where a rather significant pullback is warranted.Just a word of caution though, we have seen before how seasonal strength in gold is frontrun in December before a less convincing showing in January. That especially since the period after the Covid pandemic. So, just take note of that.Gold put on a solid December showing in gaining 2.5% on the month and is up over 33% since August last year. The numbers for silver look even more absurd with 27% gains in December and it being up 102% since August last year. Is there one last breath to the run before we hit an air pocket? This article was written by Justin Low at investinglive.com.

Prior 50.2There is a slight negative revision but it still marks an improvement to November, as the UK manufacturing recovery continues at end of 2025. Of note, both output and new orders nudged higher in helping to see the headline reading post a 15-month high. So, that's a positive signal at least. However, there was a mild increase in price pressures as input cost inflation accelerated and output charges rose after declining in November. S&P Global notes that:“Further signs of growth emanated from the UK manufacturing sector before the turn of the year. Output rose for the third successive month and new order intakes improved, albeit slightly, for the first time since September 2024. The domestic market remained a positive spur to growth while new export business, despite having now fallen for almost four consecutive years, took a sizeable stride towards stabilising. "UK manufacturers benefited from several reduced headwinds towards the end of the year, as the negative impacts of the uncertainty surrounding the Autumn Budget, tariffs and the JLR cyber-attack all moderated. "The start of 2026 will show if growth can be sustained after these temporary boosts subside. The base of the expansion needs to shift more towards rising demand and away from inventory building and backlog clearance. December’s interest rate cut will hopefully play some part in assisting this transition, encouraging manufacturers and their customers to increase spending and investment. Manufacturers remain uncertain on this score, with business optimism falling for the first time in three months in December.” This article was written by Justin Low at investinglive.com.

Prior 49.6 This article was written by Justin Low at investinglive.com.

Prior 48.2The headline reading is a 10-month low as a drop in demand conditions sees German manufacturing activity slump in the final month of last year. Of note, manufacturing output slid into contraction territory for the first time in ten months amid falling export sales. And that led to deeper cuts to employment, purchasing and stocks of inputs.Meanwhile, price pressures remain sticky as goods producers reported a rise in average input prices for the first time in almost three years in December. And panel members also noted that metals were a key driver of cost inflation. So, that's something to take note of at least. HCOB comments that:“Manufacturing had shown hints of recovery earlier in 2025, but the downturn has deepened again in December, driven by investment and consumer goods. The headline PMI index has slipped to its lowest point since last February. The sharp decline in export orders, which have now fallen for the fifth month in a row, points to a very weak start to 2026. “In December, industry was affected not only by weak demand and falling sales prices, but also by rising input prices, which came as a surprise. Over the past few months, these prices had shown signs of stabilising, but an increase is something that has not happened for almost three years. This increase could be due to the higher prices of industrial metals such as copper and tin, which were more expensive in euro terms both compared to the month before and a year ago. “Inventories of purchased goods have fallen at an accelerated pace over the past three months. With orders drying up, companies also want to save on inventories and are reducing them. Stocks of inputs have been falling since the beginning of 2023, which is unusually long, and developments over the past three months give no hope for a turnaround anytime soon. “Staff reductions continued almost unabated in December. Lower investment and cost-saving measures likely drove that trend. The accelerated depreciation option, which has been available since last July, has obviously not yet had any visible effect. With the start of government-backed infrastructure projects and the booming demand for defence equipment, things could look different in 2026. In fact, more companies now expect higher production a year from now.” This article was written by Justin Low at investinglive.com.

Prior 47.8The final estimate is little changed from the preliminary reading as France's manufacturing sector saw a modest jump in activity to round off the 2025 year. A strong rise in new export orders was the key reason in underpinning sentiment while employment conditions also returned to growth on the month. Meanwhile, output volumes also came close to stabilising after November's sharp and accelerated contraction. HCOB notes that:"2025 closes on a surprisingly upbeat note. Business conditions in France’s manufacturing sector improved in December, with the PMI climbing back above the growth threshold to reach its highest level in three-and-a-half years. While this should not obscure the structural challenges of recent years, it is nonetheless a step in the right direction. Looking ahead, the sector could benefit from large-scale orders in defence and aerospace, particularly from abroad, as export demand has already shown greater resilience than domestic orders in recent months. Still, persistent political instability and the resulting uncertainty among businesses and households remain key headwinds for future prospects. "After several months of contraction, production at French manufacturing plants broadly stabilised in December. Robust export orders were a key support, even as pressure on supply chains and cautious customer behaviour continue to limit output. Companies have also been meeting orders by drawing down inventories. Purchasing activity, which has been declining since 2022, is now approaching stabilisation, potentially signalling that the sector may have reached its trough heading into next year. "The modest improvement in business conditions has prompted firms to raise prices again after three consecutive months of cuts, likely aimed at stimulating sales. Input cost inflation remains subdued, providing some relief, but margin pressures will persist if demand fails to strengthen further." This article was written by Justin Low at investinglive.com.