Summary BoJ raised policy rate to 0.75% as expected Decision was unanimous, but wording saw dissent Real rates remain significantly negativeThe Bank of Japan raised its short-term policy rate by 25 basis points to 0.75%, delivering a widely anticipated move that takes borrowing costs to their highest level in around three decades. The decision was approved by a unanimous vote, underscoring broad agreement among policymakers that conditions now justified a further step toward normalisation. Despite the hike, the BoJ was careful to emphasise that monetary conditions remain accommodative, repeatedly highlighting that real interest rates are expected to stay significantly negative even after the policy adjustment. Officials said the move should be seen as part of a gradual and cautious process rather than a shift toward restrictive policy.In its statement, the central bank said it would continue to raise the policy rate if the economy and prices move in line with its forecasts, signalling conditional openness to further tightening. Policymakers added that the likelihood of achieving the baseline scenario has been rising, reflecting growing confidence that inflation dynamics are becoming more durable.The BoJ reiterated that it will conduct policy from the perspective of sustainably and stably achieving its 2% inflation target, while avoiding excessive tightening that could destabilise financial conditions. Officials said wages and inflation are likely to continue rising moderately in tandem, reinforcing the narrative that price pressures are increasingly supported by domestic demand rather than temporary cost factors.However, the meeting also revealed nuances within the Policy Board. Board member Takata opposed the description of the inflation outlook, arguing that the rate of increase in CPI, including underlying measures, had already generally reached the price stability target. Separately, board member Tamura opposed the wording on underlying CPI inflation and said it was likely to be broadly consistent with the target from the middle of the projection period.These objections did not extend to the rate decision itself but highlight an emerging debate over how close Japan is to achieving price stability on a sustained basis, a discussion that could shape the pace of future tightening.From a market perspective, the decision was said to be fully priced, limiting immediate volatility in the yen and JGBs. Despite this the yen fas dipped, with USD/JPY popping above 158.00. Focus is expected to remain on guidance, wage trends and how confidently the BoJ views inflation sustainability heading into 2026.Overall, the message was clear: normalisation is progressing, but the Bank remains committed to moving slowly, carefully and data-dependently, with no preset path for further rate increases. ---Due at 0630 GMT is Bank of Japan Governor Ueda's news conference This article was written by Eamonn Sheridan at investinglive.com.

The Bank of Japan raised its short-term policy rate by 25 basis points, lifting it to 0.75%, in a widely anticipated move that marks the highest level in roughly three decades and underscores the central bank’s gradual shift away from ultra-loose policy. I'll have more specific detail on the statement and associated BoJ releases soon, but for now I want to note the following. The decision had been fully priced by markets following a steady drumbeat of firm inflation data and increasingly confident signals from policymakers. As a result, the immediate market reaction was muted, with attention quickly turning from the rate hike itself to the Bank’s forward guidance and Governor Kazuo Ueda’s assessment of the path ahead.In its statement, the BoJ acknowledged that inflation has remained above its 2% target for an extended period, supported not only by imported cost pressures but also by firmer domestic price dynamics. At the same time, policymakers emphasised that real interest rates remain clearly negative, reinforcing the view that monetary conditions are still accommodative even after the hike.Governor Ueda will likely strike struck a cautious tone in his press conference, stressing that future adjustments will depend on whether inflation proves sustainable and demand-driven. He'll highlight the importance of wage developments, household consumption and corporate investment, while also noting the recent rise in Japanese government bond yields and the need to avoid destabilising financial conditions.Markets continue to debate the timing of the next move. While some pricing points to another hike as early as mid-2026, others argue the bar for further tightening has risen, particularly given lingering uncertainty around global growth and the transmission of higher rates through Japan’s highly leveraged public sector.From a market perspective, the lack of surprise reduced the risk of volatility seen during earlier policy shifts. Unlike past episodes that triggered sharp yen-funded carry unwinds, the currency’s reaction this time is likely to be driven more by guidance than by the rate increase itself.Overall, the decision reinforces the BoJ’s message: policy normalisation is under way, but it will proceed slowly, cautiously and data-dependently, with no preset course for further tightening. Bank of Japan Governor Ueda's press conference begins at 0630 GMT / 0130 US Eastern time. This article was written by Eamonn Sheridan at investinglive.com.

Summary Toyota to export U.S.-made vehicles to Japan Move aimed at easing U.S.–Japan trade tensions Tariff relief a key motivationToyota Motor Corp plans to begin selling U.S.-manufactured vehicles in Japan from 2026, a move aimed at easing trade tensions with Washington and strengthening ties with President Donald Trump’s administration as tariff negotiations remain in focus.The Japanese automaker said it will export three U.S.-built models, the Camry, Highlander and Tundra, to the Japanese market, with production sourced from plants in Kentucky, Indiana and Texas. Toyota said the vehicles are intended to meet a range of customer needs in Japan while also demonstrating the company’s commitment to balanced Japan–U.S. trade relations.The decision comes as Toyota and other Japanese automakers seek to encourage the Trump administration to ease or remove tariffs on Japanese car and auto-parts exports to the United States. Trump has repeatedly criticised trade imbalances in the auto sector and has pushed foreign manufacturers to expand U.S. production and exports as part of his broader trade agenda.Toyota already operates extensive manufacturing operations in the United States and has long argued that it is a major contributor to U.S. employment and investment. Exporting U.S.-made vehicles back to Japan represents a symbolic reversal of traditional trade flows and underscores Toyota’s willingness to align with Washington’s policy priorities.While Japan’s domestic auto market has historically favoured smaller vehicles, Toyota said the selected models reflect growing diversity in consumer preferences and will complement its existing lineup. The company did not disclose expected sales volumes, but analysts view the move primarily as a strategic trade and political gesture rather than a volume-driven initiative.From a broader perspective, the plan highlights how global automakers are increasingly adapting supply chains and sales strategies in response to geopolitical pressures rather than pure market demand. For Toyota, the move reinforces its position as a bridge between the world’s two largest auto markets at a time when trade policy uncertainty remains elevated. This article was written by Eamonn Sheridan at investinglive.com.

Summary Japan signals greater focus on fiscal sustainability Debt-to-GDP reduction framed as confidence booster Tax relief costs revised higherJapan’s Finance Minister Katayama signalled a renewed emphasis on fiscal discipline when outlining priorities for compiling the next fiscal year’s budget, highlighting the need to balance policy support with long-term sustainability and market confidence.Speaking on Friday, Katayama said the government would take fiscal sustainability into account “to some extent” when preparing the upcoming budget, an acknowledgement of growing scrutiny over Japan’s public finances as interest rates rise and debt servicing costs edge higher. Japan’s debt-to-GDP ratio remains the highest among advanced economies, leaving fiscal policy closely intertwined with monetary policy and market sentiment.Katayama said the government aims to boost market confidence by lowering the debt-to-GDP ratio, reinforcing messaging that fiscal credibility remains a priority even as policymakers consider measures to support households and growth. While the comments stopped short of committing to specific consolidation targets, they suggest a cautious approach to budget expansion following years of pandemic-era stimulus and elevated spending.The finance minister also highlighted the fiscal trade-offs associated with proposed tax relief measures. The Ministry of Finance now estimates that lifting the tax-free income threshold would reduce annual tax revenue by around ¥650 billion, significantly more than its earlier estimate of ¥400 billion. The revision underscores the budgetary cost of measures aimed at easing household tax burdens, particularly at a time when inflation and wage dynamics remain in flux.For markets, the remarks are notable against the backdrop of an expected Bank of Japan rate hike and rising Japanese government bond yields. A stronger focus on fiscal sustainability could help reassure investors concerned about the interaction between higher rates and Japan’s debt load, particularly if policy normalisation continues gradually. Katayama said there is no gap in thinking with Bank of Japan Governor Ueda, that finance ministry communications with Bank have been very positive. At the same time, the government faces competing pressures: maintaining fiscal credibility while responding to political demands for tax relief and economic support. How those tensions are resolved in the final budget will be closely watched by bond investors, rating agencies and currency markets alike.Overall, Katayama’s comments suggest the government is keenly aware that fiscal policy will play an increasingly important role in anchoring confidence as Japan transitions away from ultra-loose monetary settings. This article was written by Eamonn Sheridan at investinglive.com.

Summary EU approves €90bn Ukraine financing for 2026–27 Deal builds on budget headroom borrowing plans Multi-year support aims to boost certaintyEuropean Union leaders have reached agreement on a major new financial support package for Ukraine, approving €90 billion of funding for 2026–27, according to comments from European Council President António Costa. German Chancellor Merz confirms the 90bn euro loan is interest free and the Europe will keep Russian assets frozen until Putin has compensated Ukraine.“We have a deal to finance Ukraine,” Costa said, confirming that the decision to provide €90bn of support over the two-year period had been approved. The announcement follows earlier indications that EU leaders were close to consensus on a financing framework built around collective borrowing and the use of EU budget headroom.The agreement builds on draft conclusions seen earlier by Reuters, which outlined plans for the European Commission to raise funds on capital markets, with the loans backed by unused EU budget capacity rather than direct national contributions. EU officials had said there was a realistic path to unanimity, particularly after clarifications that the mechanism would not affect the financial obligations of certain member states, including Hungary, Slovakia and the Czech Republic.The structure is designed to ensure predictable, multi-year funding for Ukraine as the war with Russia continues, while limiting immediate fiscal strain on individual EU governments. Leaders have also called for continued work on the technical and legal aspects of the instruments underpinning the financing, including options linked to so-called “reparations loans” and the potential future use of frozen Russian assets.The €90bn envelope underscores the EU’s intent to provide sustained support rather than rolling short-term packages, a shift aimed at improving financial certainty for Kyiv and strengthening longer-term planning for reconstruction and defence. It also reflects a growing willingness within the bloc to deploy EU-level borrowing as a geopolitical tool, following precedents set during the pandemic and energy crisis.From a market perspective, the deal is unlikely to materially disrupt near-term sovereign issuance or euro-area funding conditions. However, it reinforces the structural trend toward greater EU-level debt issuance and deeper fiscal coordination, with longer-term implications for euro-area bond markets and regional stability. This article was written by Eamonn Sheridan at investinglive.com.

Summary EU agrees in principle on Ukraine loan Funding to be backed by EU budget headroom Unanimity among member states appears possibleEuropean Union leaders have agreed in principle to provide a new loan to Ukraine, funded through EU borrowing on capital markets and backed by unused EU budget headroom, according to draft conclusions seen by Reuters.Under the proposal, the European Commission would raise funds on financial markets, with the loan guaranteed by the EU’s budgetary capacity rather than direct national contributions. An EU official said there appears to be a pathway toward unanimity among member states to use the headroom of the EU budget to provide funding for Ukraine, according to draft text seen by Reuters.The draft also specifies that any mobilisation of EU budget resources used as a guarantee for the loan would not affect the financial obligations of the Czech Republic, Hungary or Slovakia, addressing concerns from some governments about potential fiscal exposure, the draft text showed.EU leaders further agreed that work should continue on the technical and legal aspects of the instruments establishing what has been described as a “reparations loan,” according to the draft seen by Reuters, as discussions continue over longer-term funding mechanisms and the possible use of frozen Russian assets.The agreement in principle highlights the EU’s continued commitment to supporting Ukraine while navigating internal political sensitivities. By relying on collective borrowing and budget guarantees, EU leaders aim to sustain financial assistance without placing immediate strain on national budgets. This article was written by Eamonn Sheridan at investinglive.com.

Summary U.S. launches interagency review of Nvidia H200 exports Trump backs controlled chip sales to China National security concerns remain centralThe Trump administration has initiated a multi-agency review that could pave the way for the first-ever sales of Nvidia’s H200 artificial intelligence chips to China, according to sources familiar with the process cited by Reuters, marking a potential shift in U.S. technology export policy.The review follows President Donald Trump’s recent pledge to allow sales of Nvidia’s H200 chips to China, subject to a 25% fee paid to the U.S. government. Trump has argued that permitting controlled exports would help U.S. firms maintain technological leadership by reducing incentives for China to accelerate domestic chip development.According to sources, the U.S. Commerce Department has circulated license applications for the proposed shipments to the State, Energy and Defense Departments for interagency review. Under export control rules, those agencies have 30 days to assess the applications, with the final decision resting with the president if disagreements emerge. The start of the review process has not been previously reported.The move has reignited debate in Washington. China hawks across both parties have warned that advanced AI chips could enhance Beijing’s military capabilities and undermine U.S. dominance in artificial intelligence. The H200, while slower than Nvidia’s flagship Blackwell chips, remains a powerful and widely used accelerator that has never been permitted for sale to China.Nvidia has reportedly been considering increasing production of the H200 after initial demand from China exceeded available capacity, according to a separate Reuters report. However, uncertainty remains over whether Chinese authorities would approve domestic firms purchasing the chips if U.S. licenses are granted.Within the administration, officials led by White House AI adviser David Sacks argue that allowing limited sales could blunt the rise of Chinese competitors such as Huawei, discouraging accelerated efforts to rival Nvidia and AMD at the cutting edge.While you'd expect this to be a positive for NVDA, and it is, its not like Trump's support for sales to China is new news. This should keep any positive market response more subdued than otherwise. 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 close of the previous session was at 7.0412. The rate at 7.0550 today is the strongest setting for CNY since 30 September, 2024.Earlier:PBOC is expected to set the USD/CNY reference rate at 7.0378 – Reuters estimateThe 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. ---While you're here, an ICYMI via Reuters. China has made a significant, if still incomplete, advance in its push to challenge Western dominance in advanced semiconductor manufacturing, according to sources familiar with a highly classified project in Shenzhen.In a secure laboratory, a team of Chinese engineers has built a prototype extreme ultraviolet (EUV) lithography machine, the critical technology required to manufacture the most advanced chips used in artificial intelligence, smartphones and military systems. The machine, completed in early 2025 and now undergoing testing, reportedly occupies most of a factory floor and was developed by former engineers from Dutch chip-equipment maker ASML who reverse-engineered the technology, sources said.EUV lithography sits at the centre of what has become a technological Cold War, as the West has sought to restrict China’s access to the machines through export controls. The systems use extreme ultraviolet light to etch circuits thousands of times thinner than a human hair, enabling the production of the world’s most powerful semiconductors.While China’s prototype is operational and has successfully generated EUV light, it has not yet produced functional chips, underscoring the technical hurdles that remain. The Chinese government is targeting 2028 for the production of working chips using domestically built EUV tools, though people close to the project say 2030 is a more realistic timeline.If successful, the effort would mark a major breakthrough in China’s quest for semiconductor self-sufficiency and reduce its reliance on Western technology, with far-reaching implications for global supply chains, geopolitics and the balance of technological power. This article was written by Eamonn Sheridan at investinglive.com.

Australia Private Sector Credit for November 2025: +0.6% m/mexpected +0.6%, prior +0.7% Summary Credit growth matched expectations in November Lending remains steady, as do rates for now Limited implications for RBA policyAustralia’s private sector credit growth held steady in November, offering little in the way of fresh signals for monetary policy but reinforcing the view of a cautiously expanding credit environment.Data published by the Reserve Bank of Australia showed private sector credit rose 0.6% month-on-month in November, in line with market expectations and only marginally softer than the 0.7% increase recorded in October. The result points to stable borrowing conditions across the economy, with neither a sharp acceleration nor a meaningful slowdown in credit demand.Private sector credit is a broad measure capturing lending to households and businesses, and is closely watched as an indicator of financial conditions, economic momentum and the transmission of monetary policy. Sustained strength in credit growth can signal rising demand and inflationary pressure, while weakness may point to tighter financial conditions and slowing activity.The November reading suggests that stable interest rates continue to restrain borrowing at the margin, but have not triggered a sharp contraction in credit. Household balance sheets remain relatively resilient, while business borrowing appears steady, supported by ongoing investment needs and population-driven demand.For the RBA, the data is unlikely to materially shift the policy outlook on its own. Credit growth at this pace is broadly consistent with an economy growing modestly below trend.From a market perspective, private sector credit is best viewed as a secondary indicator, offering confirmation rather than a catalyst. FX and rates markets tend to respond more directly to inflation, wages and labour market data, with credit figures used to validate broader narratives around growth and financial conditions.Still, the steadiness of credit growth matters at the margin. A sustained deceleration would strengthen the case for eventual easing, while any renewed acceleration could reignite concerns about household leverage and inflation persistence.This screenshot shows the dates of Reserve Bank of Australia policy meetings coming in 2026. 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 Goldman expects three BoE cuts in 2026In March, June and September, from their previous forecast of a cut in each of February, April, and July.Labour market weakening supports easing Inflation seen remaining containedThe Bank of England’s decision to cut interest rates on 18 December has reinforced expectations that the UK central bank is entering a more sustained easing cycle, with Goldman Sachs continuing to forecast multiple rate cuts through 2026 amid weakening economic momentum.In a research note, Goldman said it expects the BoE to deliver 25 basis point cuts in March, June and September, revising its earlier call that had pencilled in moves in February, April and July. The shift in timing reflects the bank’s assessment that the Monetary Policy Committee (MPC) will proceed cautiously but steadily as evidence mounts that inflation pressures are easing and labour market conditions are deteriorating.Goldman argues that recent UK data has increasingly tilted risks toward a softer growth outlook. Labour market indicators have shown signs of cooling, including slower hiring, rising unemployment risks and easing wage pressures. At the same time, the bank expects inflation to remain well-behaved through 2026, reducing the need for the BoE to maintain a restrictive policy stance.While markets currently price a gradual pace of easing, Goldman sees scope for the BoE to cut rates more aggressively than investors anticipate if incoming data continues to confirm these trends. The bank notes that weak activity data could give policymakers greater confidence to lean dovish, particularly if inflation expectations remain anchored.The December cut marked a shift in the BoE’s policy narrative, signalling that the balance of risks has moved away from persistent inflation and toward supporting growth. However, policymakers are expected to retain a data-dependent approach, closely monitoring wage dynamics, services inflation and broader financial conditions.From a market perspective, the evolving BoE outlook has implications for UK rates, sterling and relative monetary policy divergence. A faster or deeper easing cycle would likely weigh on the pound while supporting UK risk assets, particularly if global central banks move more cautiously.Overall, Goldman’s revised forecast underscores growing confidence that the BoE’s tightening phase is firmly over, with the next challenge centred on calibrating the pace and depth of rate cuts as the UK economy navigates a softer growth environment. This article was written by Eamonn Sheridan at investinglive.com.

United Kingdom GfK Consumer Confidence for December 2025: -17 vs. expected -18, prior -19 Summary Improved modestly in DecemberBudget restraint and easing inflation offered support Spending remains weak despite real wage gains British consumer confidence edged higher in December, reaching its joint-highest level of the year, though sentiment remains weak by historical standards, according to a closely watched monthly survey from GfK.The GfK consumer confidence index rose to -17 in December, matching levels last seen in October and August. The reading marks the strongest level since August 2024, shortly after the Labour government took office, but still points to a cautious and fragile consumer backdrop.The modest improvement followed Chancellor Rachel Reeves’ annual budget, which imposed relatively few immediate tax increases on households. While the budget raised Britain’s overall tax burden by around £26 billion per year, this was notably smaller than the £40 billion increase announced in 2024, and much of the additional tax impact will not take effect until later years.GfK noted that households’ assessment of the general economic outlook improved more than perceptions of their own personal finances. Encouragingly, consumers’ willingness to make major purchases recorded the largest gain among the survey’s components, suggesting tentative signs of easing caution.Commenting on the data, GfK consumer insights director Neil Bellamy likened consumers to “a family on a festive winter hike,” moving forward slowly while hoping for better conditions ahead, a metaphor that captures both resilience and ongoing uncertainty.The confidence uptick also comes against a slightly more supportive inflation backdrop. Consumer price inflation slowed to 3.2% in November, its lowest level since March, and the government’s budget included measures to shift climate-related costs away from household energy bills and into general taxation, potentially easing near-term pressure on disposable incomes.Despite these factors, consumer spending in the UK has remained subdued. Although wages have outpaced inflation this year, households — like their counterparts across much of Europe — have continued to save at elevated rates. This reluctance to spend has puzzled economists and suggests that confidence, while improving, has yet to translate into a meaningful recovery in consumption. This article was written by Eamonn Sheridan at investinglive.com.

Summary Core CPI held at 3.0% in November Underlying inflation pressures remain firm Data supports gradual BoJ tighteningJapan’s nationwide inflation data for November showed price pressures remaining firmly entrenched, reinforcing expectations that the Bank of Japan will continue its gradual path toward policy normalisation.Government data released on Friday showed core consumer prices rose 3.0% year-on-year in November, matching market expectations and marking another month of inflation running well above the Bank of Japan’s 2% target. The core measure excludes fresh food prices but includes energy, making it one of the most closely watched gauges of underlying inflation trends.Headline inflation was little changed, with overall CPI rising 2.9% year-on-year, underscoring persistent price pressures across the economy despite recent volatility in energy markets and a modest slowdown in global growth momentum.A broader measure of underlying inflation, which excludes both fresh food and energy prices, also rose 3.0% from a year earlier. The strength of this “core-core” gauge suggests inflation is no longer being driven solely by imported cost pressures, but is increasingly supported by domestic factors such as services prices, labour costs and corporate pricing behaviour.The November data reinforces the view that Japan’s inflation backdrop remains fundamentally different from the deflationary environment that characterised much of the past two decades. While policymakers continue to stress the need for sustainable, demand-driven inflation, recent readings point to a more persistent trend than initially expected.From a policy perspective, the inflation figures strengthen the case for the Bank of Japan’s expected rate hike, which would take its policy rate to the highest level in roughly three decades. However, officials are likely to maintain a cautious tone, mindful of the recent rise in Japanese government bond yields and the sensitivity of financial conditions to further tightening.For markets, the data is broadly in line with expectations and therefore unlikely to trigger significant volatility on its own. Instead, attention is expected to remain focused on the BoJ’s policy guidance and Governor Kazuo Ueda’s assessment of whether current inflation dynamics are sufficiently durable to justify further rate increases over time. This article was written by Eamonn Sheridan at investinglive.com.

Summary Goldman sees CPI having limited Fed impact December data more important for January meeting Core PCE disinflation remains intactThe latest U.S. consumer price index (CPI) data released on 18 December is unlikely to materially alter the Federal Reserve’s near-term policy outlook, according to Goldman Sachs, which argues policymakers will instead focus on inflation data still to come ahead of the January FOMC meeting.In a note following the CPI release, Goldman said today’s reading is “unlikely to move the needle” for the Fed, despite headline and core measures continuing to show progress on disinflation. The bank emphasised that December inflation data, which will be released just before the Fed’s January meeting, will carry greater significance for policymakers assessing whether price pressures are cooling in a sustained manner.Goldman’s analysis suggests that recent downside surprises in core CPI have been driven largely by technical and timing-related factors rather than a broad-based easing in underlying inflation. Specifically, the firm points to a sizeable drag from shelter components, stemming from methodological issues related to missing October data, as well as softer core goods prices due to later-than-usual price collection in November.Looking beyond CPI, Goldman estimates that the core Personal Consumption Expenditures (PCE) price index, the Fed’s preferred inflation gauge, rose by an average of 0.12% month-on-month across October and November. The bank estimates a 0.10% increase in October and 0.14% in November, which would lower the year-on-year core PCE rate to 2.66% in November, down from 2.83% in September.(As an aside, there is no official release date yet set for the November PCE and core PCE data).While this trajectory supports the broader disinflation narrative, Goldman cautions against over-interpreting recent CPI softness. The firm notes that the Bureau of Labor Statistics has not yet clarified how it will address the identified distortions, raising the possibility that some of the recent drag could reverse in coming months.Goldman expects part of the shelter weakness to unwind in future releases, while goods inflation could re-accelerate modestly in December. As a result, the bank sees the Fed remaining patient, with policymakers likely to rely on a broader run of data rather than a single CPI print when shaping policy decisions in early 2026. This article was written by Eamonn Sheridan at investinglive.com.

Summary Reports suggest Cybercab testing on public roads Austin seen as key autonomy testing hub Autonomy central to Tesla’s long-term narrative Shares of Tesla are likely to draw fresh attention after social media reports suggested the company’s long-awaited Cybercab vehicle has been spotted testing on public roads in Austin, Texas for the first time. While Tesla has not formally confirmed the sightings, the reports have fuelled speculation that development of its dedicated autonomous ride-hailing vehicle may be entering a more advanced testing phase.According to posts circulating on X, the vehicle appeared to be operating on open roads rather than closed or private testing areas, a step that would mark a meaningful milestone for Tesla’s autonomous ambitions. Austin has become a central hub for Tesla’s self-driving efforts, hosting both its headquarters and extensive testing operations, and is viewed as a favourable regulatory environment for autonomous vehicle trials.The Cybercab concept, unveiled earlier this year, is designed as a purpose-built, fully autonomous vehicle with no steering wheel or pedals, aimed at powering a future robotaxi network. Tesla has positioned the project as a key pillar of its long-term growth strategy, arguing that autonomy and mobility services could eventually eclipse vehicle sales as a revenue driver.Market focus has increasingly shifted toward tangible progress on autonomy following years of ambitious timelines from Chief Executive Elon Musk. Public-road testing, if confirmed, would be seen as an incremental but important step toward regulatory approval and broader commercial deployment, though significant hurdles remain.Regulatory scrutiny, safety validation and real-world performance data are expected to be decisive factors. U.S. regulators have taken a more cautious stance on autonomous driving claims in recent years, and any expansion of testing will likely be closely monitored at both state and federal levels.From an investor perspective, the reports underline Tesla’s effort to re-anchor its valuation narrative around artificial intelligence and autonomy at a time when global EV demand growth has moderated. While near-term financial impact is limited, progress on Cybercab development could influence longer-term expectations for Tesla’s addressable market and margin potential.For now, markets await official confirmation from Tesla, with sentiment likely to remain sensitive to further evidence of real-world testing and regulatory engagement. This article was written by Eamonn Sheridan at investinglive.com.

Summary PM office source raises nuclear weapons debate Comments clash with Japan’s non-nuclear tradition Security concerns driving renewed discussion Japan’s long-standing stance on nuclear weapons has come under renewed scrutiny after a source within the prime minister’s office suggested the country may ultimately need to possess nuclear arms, comments that risk sparking political backlash both domestically and internationally. Kyodo reporting. Speaking to reporters on Thursday, the source — who is involved in shaping security policy under Prime Minister Sanae Takaichi’s government — said Japan should consider nuclear weapons in principle, while simultaneously acknowledging that such a move would be highly impractical. “I think we should possess nuclear weapons,” the source said, adding that “in the end, we can only rely on ourselves,” while stressing that nuclear armament is not something that could be achieved quickly.The remarks come as Prime Minister Takaichi, known for her hawkish views on national security, weighs whether to review Japan’s Three Non-Nuclear Principles, which prohibit the possession, production, or introduction of nuclear weapons. First articulated by then-Prime Minister Eisaku Sato in 1967, the principles became a cornerstone of Japan’s postwar identity. Sato later received the Nobel Peace Prize in 1974 for his role in promoting nuclear restraint.Any attempt to revisit Japan’s nuclear policy remains deeply controversial. Public opposition is rooted in the country’s pacifist constitution and its unique historical experience as the only nation to have suffered atomic bombings. The issue also conflicts with Japan’s longstanding diplomatic commitment to nuclear disarmament, a cause strongly supported by survivors of Hiroshima and Nagasaki.At the same time, critics note that Japan already relies on the U.S. nuclear umbrella for deterrence, a dependence some argue sits uneasily alongside the non-nuclear principles. This tension has periodically resurfaced during periods of heightened regional security risk.The prime minister’s office source said there had been no direct discussion with Takaichi on formally revising the principles. Still, the comments have revived memories of past political fallout: in 1999, then parliamentary vice defence minister Shingo Nishimura was dismissed after suggesting Japan consider nuclear armament.For now, the remarks underscore the growing strain between Japan’s historical pacifism and evolving regional security realities.---When these guys are your near neighbor ... Anyway, more near term, the BoJ is set to make history today:Economic and event calendar in Asia December 19, 2025 - Bank of Japan rate hike expected This article was written by Eamonn Sheridan at investinglive.com.

The GBPUSD pair has transformed into a technical battleground as the trading week nears its close. A combination of a divided Bank of England (BoE) and a cooling US inflation report has created a "whipsaw" environment, leaving the price resting precariously on a significant layer of technical support.The BoE Catalyst: A narrow 5-4 vote for a "hawkish cut" by the Bank of England initially sparked Sterling strength, signaling that the path to future rate cuts remains steep.The CPI Whipsaw: A soft US CPI print (2.7%) sent the pair to a multi-week high of 1.3446 before a massive retracement saw the pair surrender all daily gains.The Technical Floor: The price is currently testing a "cluster" of four major moving averages between 1.3348 and 1.3380, a zone that will define the trend for the Friday close.Breaking Down the Momentum: From Hawkish Cuts to Soft CPIThe initial leg of the GBPUSD rally was fundamentally driven. The Bank of England’s decision to cut rates—but with a clear 5-4 split—indicated to the markets that the BoE is not in a rush to ease aggressively. This "hawkish lean" gave the British Pound a head start against a softening Greenback.Later, the US Consumer Price Index (CPI) added fuel to the fire. The weaker-than-expected inflation data triggered a sharp sell-off in the US Dollar, propelling the "Cable" above a series of key daily and hourly moving averages. This move saw the pair challenge the highs of the last two weeks, specifically testing the Tuesday peak near 1.3455.The "Moving Average Cluster" BarometerDespite the breakout, momentum failed to hold. The pair has retraced back into a dense zone where four critical moving averages are currently overlapping. This "cluster" acts as a massive technical pivot point:100-Hour MA: 1.33804 (The current immediate ceiling)200-Hour MA: 1.33640100-Day MA: 1.33616200-Day MA: 1.33488 (The ultimate floor)As long as the price remains within or above this zone, the "Up and Down" volatility theme persists. The price action today reached as low as 1.3370 before stabilizing slightly, keeping the market in a state of high suspense.The Roadmap: What to Watch for the Friday CloseAs we transition into the final session of the week, the cluster of moving averages will serve as the primary barometer for directional bias.The Bullish ScenarioFor the buyers to reclaim the driver's seat, they must keep the price sustained above the 1.33804 (100-hour MA). A push above the 1.3405 swing area is required to confirm that the bears have been flushed out. If successful, the door opens for another run toward the recent highs at 1.34526.The Bearish ScenarioIf the sellers gain enough traction to break below the bottom of the cluster at 1.33488 (200-day MA), the technical picture turns decidedly bearish. A break here would likely trigger a retest of the weekly low at 1.33118, with a secondary target at last week's low and the key 38.2% Fibonacci retracement level of 1.32833.Watch the Video AnalysisIn the video above, Greg Michalowski, author ofAttacking Currency Trends, provides a deep dive into these GBPUSD technical levels. He breaks down the real-time price action, helps you define the bias, the risk, and the specific targets that will matter most today and going forward.Be aware. Be prepared. This article was written by Greg Michalowski at investinglive.com.

If clarity arrives that inflation is waning, then rates can come downIS uncomfortable front-loading rate cutsNeeds to see more sustained progress on cooling inflationMeasure of job market have shown pretty steady coolingRates can go down a fair bit as long as we know we're heading back to 2% inflationIt doesn't sound like he's opposed to another cut in January if the data cooperates. The pricing is still at 25% for a Jan cut.He said previously that his dot plot was below the median. This article was written by Adam Button at investinglive.com.

At the end of the day, a government's economic job is to spend money and collect taxes. The ones that spend too much ultimately have to pay it back, with interest. Running deficits is almost always popular with voters (and certainly with donors), particularly when it makes the stock market go up.BCA today has a great chart showing just how much more the US has been spending than any other major economy. The deficits are out of control and were worsened further this year by latest round of corporate tax cuts.The damage started with Trump's election really. That tamed the Tea Party movement and it's since been wiped out completely. the The Tax Cuts and Jobs Act of 2017 kicked off the spending orgy, covid worsened it, Biden added his infrastructure act and now Trump has gone back to the deficit trough. There is no end to it and seemingly no political appetite to deal with it. Rather, we're more likely to get politicians who lean on central banks to monetize the deficit with artificially low rates.What's worse in the US situation is that it's sitting on a time bomb around social security, medicare and healthcare in general. Congress doesn't look like it will pass Obamacare subsidies so those rates will rise in the new year but the pressure to help people pay for healthcare isn't going to go away, nor will the aging demographics and out-of-control costs of US treatment.Notably, the US dollar has been in a bull market for nearly the entirety of this chart and I don't think that's a coincidence. If/when Congress changes its tune on deficits (or the market barks), that's going to be a reversal in the USD excess. At the same time, I don't think it's a surprise that euro had a better year this year as Germany signalled a loosening of spending in order to fund military investments. This article was written by Adam Button at investinglive.com.

President Trump is planning to issue an executive order establishing two new federal holiday, according to Axios.The move would make Dec 24 and Dec 26 holidays, in addition to Christmas which is already a day off. It would apply to Federal workers but not state and local governments In reality, many workers already get these days off but some are forced to use holidays. This time of year is a great time to unwind and spend time with family and anything that stretches that timeline is good news, even if it results in a slight hit to productivity. The New York Stock Exchange currently doesn't close for either the 24th or 26th but there is an early close at 1 pm ET on the 24th. Liquidity is low at that time of year and it might be beneficial to close the market anyway. There is no obligation for exchanges to follow the federal calendar and don't for Columbus Day and Veterans Day.For the bond market, SIFMA also doesn't follow the federal calendar so ultimately this would have little direct effect on anything but could be an important signaling mechanism, or at least a way for Trump to score back some points with federal workers after the government shutdown.Axois also notes that it's not clear if Trump even has the authority to grant multiple days off by executive order but I would imagine Congress would find that hard to fight. The most recent Juneteenth holiday was passed by Congress.Other orders that Trump is considering are reclassifying cannabis and tariff rebate checks.On tariffs, the Supreme Court is likely to decide early in the year on whether tariffs are legal. If not, issuing rebates could cause a big hole in the deficit, in particularly because tariffs may have to be refunded. There is no fixed date on that decision and the Supreme Court technically has until June but important questions are usually decided early. This article was written by Adam Button at investinglive.com.