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• Prior 55.6
• Composite PMI 55.6
• Prior 55.1

The headline reading is a 12-month high and reflects a divergence in trend in Spain’s manufacturing and services sectors. The latter continues to post solid growth, with this being the 28th straight month of the PMI estimate keeping above the 50.0 threshold. A solid increase in new business and commercial work is helping to underpin the momentum in December.

That being said, inflationary pressures picked up on the month with input prices rising at its quickest pace since September. So, this will be a sticking point and one that could become a bit of a concern for the ECB if it continues to keep up; alongside Germany that is.

HCOB notes that:

“Spain’s private sector economy closed the year on a strong note, driven primarily by the services sector. While services
maintained its growth momentum, manufacturing continued to lose steam. This sectoral divergence can be traced to several
factors: external headwinds such as intensifying competition from China, continued trade frictions, and the economic
weakness persisting in key partner countries – most notably Germany and France – are weighing on industry. In contrast,
domestic strength, supported by a labour market bolstered through immigration, is underpinning services.

“Price dynamics also reflect these contrasting demand conditions. In markets with robust demand, prices tend to rise more
sharply, whereas weaker demand keeps price growth subdued. On average in 2025, output prices in manufacturing
remained flat—quite the opposite of services, where prices climbed well above their historical trend. Elevated services
inflation, fuelled by demand but also strong wage growth, was also a key topic at the latest ECB meeting and remains a
source of concern for policymakers.

“Looking ahead to 2026, the outlook for services remains upbeat: order books are solid, and recent data suggest that last
month’s dip in export orders was likely a temporary blip. Companies are responding by expanding their workforce, with a
notable increase in permanent contracts, a clear sign of confidence in medium-term demand.”

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

• Prior +0.9%
• HICP +0.7% vs +0.8% y/y expected
• Prior +0.8%

France’s headline annual inflation eased slightly in December to 0.8%. But looking at the breakdown, the drop can be attributed to a more pronounced decline in energy prices, particularly those of petroleum products. On the other hand, food prices are seen accelerating a little to 1.7% – up from 1.4% previously. Meanwhile, services inflation continues to keep steady just above the 2% threshold at 2.2% in December.

The monthly estimate shows a 0.1% increase in consumer prices, following a 0.2% decline in November. And in breaking that down, it can be attributed to the seasonal rebound in prices of services, particularly in those of transport, and, to a lesser extent, to the slight rise in food prices.

Overall, this won’t really get the ECB moving with the main focus on price pressures and inflation staying on Germany. Stagflation concerns in Europe’s largest economy remains the biggest risk to deal with at the moment. So, that will be eyed more closely and we will be getting the German numbers later in the day.

EUR/USD is trading steadier today at 1.1732 currently, up just 0.1%, with the dollar keeping a touch softer across the board.

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

The 10-year JGB auction earlier today went rather smoothly with a bid-to-cover ratio of 3.30. That pointed to some demand from investors likely amid higher yields but the selling looks to be continuing after now. 10-year Japanese government bond yields had hit its highest levels since 1999 earlier this week and are keeping thereabouts around 2.12% on the day.

Meanwhile, 30-year yields are not holding back in rising further by 3 bps to 3.485%. That follows from the gap and jump higher yesterday by around 6 bps compared to the end of last year. And it doesn’t just stop there. 20-year yields are also up around 10 bps this week to 3.08% and 40-year yields are up 8 bps to 3.69%.

As much as there is spillover pressure on the Japanese yen currency, one can argue that what is happening in the bond market might actually pose the biggest risk to the economy this year. This is something the government and the BOJ will have to watch very closely, with things definitely having accelerated in the past three months.

As a reminder, all of these rapid moves are coming after Takaichi was elected prime minister. And her more expansionary fiscal policy path is now butting heads with the Bank of Japan, as the central bank is looking to try and raise interest rates. So, it’s a really tough situation to deal with.

Considering the selloff in Japanese bonds (surging yields), the fact that the currency is also facing intense scrutiny and pressure points to the notion that traders and investors are more worried about fiscal and economic concerns. That rather than focusing on BOJ policy and narrowing rate differentials.

Those are some good points made by former BOJ policymaker Adachi last month here. It’s much easier to speak I guess when you no longer have your tongue tied.

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

Dear Client,

Please find our updated Trading schedule and general information related to the Epiphany Holiday on Tuesday, 06 January, 2026.

Liquidity over the holidays is expected to be particularly thin so please take the necessary precaution to ensure that you are not affected by increased volatility, spreads and intermittent pricing.

All times mentioned below are Platform time (GMT +2).

Kind regards,

IC Markets Team.

The post Sweden Epiphany Holiday Trading Schedule 2026 first appeared on IC Markets | Official Blog.

Summary:

• Japan’s manufacturing PMI returned to neutral territory in December

• New orders fell at the slowest pace in 19 months

• Output stabilised and employment growth accelerated modestly

• Input prices rose at the fastest rate since April

• Firms remained cautiously optimistic heading into 2026

Japan’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.

Inflation data is back on the menu but in all likelihood, it won’t do much to change the ECB outlook. As things stand, the central bank is left hanging with markets also not anticipating any interest rate moves for the year. Amid stagflation risks that could crop up, particularly in Germany, policymakers are staying vigilant and watchful awaiting the next trend in economic developments.

So for now, the inflation trend holding as it is will do little to compel the ECB to really get off their seats and take any form of action.

The French report later is estimated to see headline annual inflation keep as it is in November, at 0.9%. Core annual inflation for November was seen at 1.0%, nudging down from 1.2% in October. So, this spot is one of the softer side so to speak when it comes to the inflation narrative in the euro area.

But just take note that when we get to the January 2026 readings next month, INSEE will be changing the reference year to the consumer price index i.e. rebasing. The base year will turn to 2025, so that could result in the annual inflation readings being a little lower even if prices have been rising steadily. Just keep that in mind.

As for the German report later, the estimates point to a cooling in headline annual inflation. The expectation is for a 2.1% reading, down from 2.3% in November. But again, the core annual inflation estimate is the more important detail to look out for. And that stood at 2.7% in November, just a little down from 2.8% in October. It’s still on the higher side though, keeping stubborn above the 2% threshold.

Here’s the agenda for today for the German state CPI releases:

0930 GMT – North Rhine Westphalia0900 GMT – Brandenburg0900 GMT – Hesse0900 GMT – Bavaria0900 GMT – Saxony1300 GMT – Germany national preliminary figures

Do note that the releases don’t exactly follow the schedule at times and may be released a little earlier or later.

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

• Indian rupee eyes modest relief as dollar eases, pressures persist
• JPMorgan sees limited oil impact from Venezuela shift, upside depends on US role
• Japan monetary base falls for first time in 18 years as BOJ exits stimulus into new era
• Magnitude 6.2 earthquake hits western Japan, no tsunami warning issued
• PBOC sets USD/ CNY central rate at 7.0173 (vs. estimate at 6.9730)
• Australian shares steady as markets brace for crucial CPI release – RBA heads up tomorrow!
• Hong Kong PMI shows sustained growth as price pressures intensify
• UK retailers warn on sticky inflation as business confidence edges higher
• Nvidia launches Rubin platform with Vera Rubin superchip at CES 2026
• Trump sets 3 strict conditions for Venezuela new leader, includes oil sales halt to China?
• Morgan Stanley flags six bullish catalysts markets may be underestimating for 2026
• Fundstrat’s Tom Lee says Bitcoin new highs soon. Sees S&P 500 to 7,700 by end 2026 too.
• Australia services PMI shows slower growth but rising price pressures in December
• Trump administration says US oil firms ready to invest in Venezuela
• India likely to retain RBI’s 4% inflation target as framework renewal nears

In brief:

• Asian equities advanced as risk sentiment improved

• Australian services PMI slowed but price pressures intensified

• NVIDIA unveiled Rubin platform and Vera Rubin superchip at CES

• Japan’s monetary base fell for first time in 18 years last year

• US dollar weakened further after soft ISM data on Monday

• AUD and NZD extended gains on risk and commodities

• Oil eased slightly; gold little changed

• Chinese stocks rallied to four-year highs

News and data flow across the Asia session was relatively light, but risk sentiment leaned constructive. Asian equities pushed higher while the US dollar extended losses from the prior session, as markets digested a mix of softer US data and key macro and corporate developments.

In Australia, the December services PMI pointed to slowing momentum but persistent inflation pressures. The index slipped to 51.1 from 52.8 in November, signalling slower growth even as new business and hiring remained firm. Input and output prices continued to intensify, reinforcing concerns that services-led inflation pressures could linger into 2026, a dynamic likely to remain on the radar for the Reserve Bank of Australia. Note, we get November CPI data released Wednesday Australia time (see point above for more detail).

Corporate focus remained on CES 2026 in Las Vegas, where NVIDIA unveiled its next-generation Rubin platform. The launch was anchored by the Vera Rubin superchip, which integrates a CPU and dual GPUs and is designed for agentic AI and advanced reasoning models. Chief executive Jensen Huang said the new AI server systems, due to go on sale in the second half of the year, deliver a tenfold cost reduction versus the prior Blackwell generation. NVIDIA also highlighted deeper integration of connectivity and memory-storage technologies, a strategy Huang said has helped position the firm as both a leading networking hardware provider and the world’s largest producer of computing semiconductors.

In Japan, data from the Bank of Japan showed the country’s monetary base contracted in 2025 for the first time in 18 years, reflecting the BOJ’s exit from ultra-loose policy. Liquidity fell sharply in December, reinforcing expectations of continued bond tapering and further rate hikes as policy normalisation progresses.

In FX markets, the US dollar remained on the back foot following Monday’s weaker-than-expected ISM manufacturing data, which outweighed initial haven demand linked to US military action in Venezuela. EUR/USD and GBP/USD edged higher, with sterling also supported by a slight acceleration in the UK BRC shop price index to 0.7%. USD/JPY was little changed, while AUD/USD and NZD/USD extended gains on improved risk appetite and firmer commodity prices.

Oil prices eased marginally, gold was broadly unchanged, and Chinese equities surged to a four-year high.

Asia-Pac
stocks:

• Japan
  (Nikkei 225) +0.69%
• Hong
  Kong (Hang Seng) +1.6%
• Shanghai
  Composite & CSI 300 both +1% nad more
• Australia
  (S&P/ASX 200) -0.3%

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• Magnitude ~6.2–6.3 quake hits Shimane Prefecture

• Epicentre located in eastern Shimane

• Intensity recorded at upper-5 on Japan scale

• No tsunami warning issued

• Authorities monitoring for aftershocks

• Depth 10km

A strong earthquake struck western Japan Tuesday, hitting Shimane Prefecture with a preliminary magnitude of around 6.2–6.3, according to Japanese authorities. The quake was centred in the eastern part of the prefecture and was felt widely across the region, though no tsunami warning was issued.

The Japan Meteorological Agency said the earthquake occurred in the evening local time and registered an upper-5 intensity on Japan’s seismic intensity scale in parts of Shimane. National broadcaster NHK reported that while shaking was strong enough to disrupt daily activity, there were no immediate reports of major damage or casualties.

Japan uses a unique seismic intensity system that measures how strongly the ground shakes at a specific location, rather than the total energy released by an earthquake. The scale runs from 1 to 7 and is designed to reflect the real-world impact on people, buildings and infrastructure. An intensity of upper-5 (known as “5-strong”) typically means it is difficult to move without holding onto something, unsecured furniture may topple, and minor structural damage is possible, particularly to older buildings.

This differs from the magnitude scale, such as the moment magnitude used internationally, which measures the earthquake’s overall size. As a result, a single earthquake can have one magnitude but varying intensity readings depending on distance from the epicentre, depth and local ground conditions.

The quake was initially reported with a preliminary magnitude of 6.3 by Japan’s National Research Institute for Earth Science and Disaster Resilience, later revised slightly lower. Authorities confirmed that the depth and offshore risk profile did not warrant a tsunami alert, easing concerns along coastal areas.

Japan is one of the world’s most seismically active countries, sitting atop several major tectonic plates. Its early-warning systems and building standards are designed to mitigate the risks from frequent earthquakes, though events of this size still pose disruption risks to transport, utilities and local communities.

Officials continue to assess the situation, urging residents to remain alert for possible aftershocks.

Let’s hope there are no injuries.

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• Hong Kong PMI remains in expansion for fifth month, 51.9 in December vs. 52.9 in November

• Output and new orders grow at solid but slower pace

• Backlogs rise for first time in a year

• Selling prices increase at fastest rate since 2023

• Business confidence improves into 2026

Business conditions across Hong Kong’s private sector continued to improve at the end of 2025, marking a fifth consecutive month of expansion, though momentum eased slightly as cost pressures intensified, according to the latest PMI data from S&P Global.

The headline Hong Kong SAR PMI slipped to 51.9 in December from 52.9 in November, remaining firmly above the 50 threshold that separates expansion from contraction. The reading points to a moderate but sustained improvement in business conditions and capped the strongest quarterly performance since early 2023.

Output rose for a fifth straight month, with growth easing from November but still among the strongest seen over the past three years. Firms cited continued improvements in demand conditions as the key driver, with sales increasing across both domestic and external markets. New orders also expanded at a solid pace, posting the second-strongest increase since April 2023, supported by higher customer numbers and improved client confidence. Notably, demand from mainland China and international markets contributed meaningfully to the upturn.

The sustained rise in new business began to stretch capacity. Backlogs of work increased for the first time in a year, a development often viewed as a forward-looking signal of further production gains ahead. While the accumulation of unfinished work remained modest, it was the most pronounced since November 2024, suggesting demand is increasingly testing firms’ operational limits.

Despite rising workloads, employment declined for a second consecutive month, largely due to the non-replacement of voluntary departures. At the same time, purchasing activity continued to rise, albeit at a slower pace, while input inventories increased for a seventh month. Firms also reported the first improvement in supplier delivery performance since May, reflecting more timely arrivals of inputs.

Price pressures were a standout feature of the December survey. Input costs rose at a solid pace, driven by higher raw material prices and a sharp acceleration in staff-related expenses, which increased at the fastest rate since June 2024. In response, firms raised selling prices at the quickest pace in 26 months, marking the strongest charge inflation since October 2023.

Looking ahead, sentiment improved further. While firms remained cautious about global growth and tariff risks, pessimism about the year-ahead outlook eased to its lowest level since mid-2023, underpinned by growing confidence in domestic economic conditions.

Commenting on the data, Usamah Bhatti, Economist at S&P Global Market Intelligence, said rising backlogs point to potential further output gains, while easing pessimism suggests the recovery has gained firmer footing into 2026.

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• UK shop price inflation rose to 0.7% in December

• Food inflation accelerated while non-food prices fell

• Retailers warn higher wages and regulation may keep prices sticky

• Business confidence improved but remains below average

• Capex intentions rose to a 2.5-year high

UK retailers raised prices at a faster pace in December and warn that further increases may be difficult to avoid in 2026, even as broader business confidence shows early signs of stabilisation, according to new industry data and corporate surveys released Tuesday.

Figures from the British Retail Consortium showed annual shop price inflation edged up to 0.7% in December (0.6% expected) from 0.6% in November, remaining in line with its three-month average. While overall inflation remains modest, the composition of price pressures is becoming more concerning for policymakers.

Food inflation accelerated to 3.3% year-on-year, up from 3.0% the previous month, reflecting ongoing cost pressures across supply chains. By contrast, prices for non-food items continued to fall, declining 0.6% annually, unchanged from November, as retailers used discounting to stimulate demand and clear inventories.

BRC chief executive Helen Dickinson said retailers would continue efforts to limit price rises, but warned that easing pressures from lower energy costs and improved crop conditions may be offset by rising policy-driven costs. She highlighted increasing regulation and higher labour expenses as key risks to keeping inflation contained.

Those labour pressures are set to intensify in April, when the UK’s minimum wage rises by 4.1% to £12.71 an hour. Staffing costs have already been lifted by measures introduced in Chancellor Rachel Reeves’ first budget in October 2024, adding to the challenge for price-sensitive sectors such as retail. The Bank of England is monitoring food prices closely, given their role in shaping household inflation expectations, even as headline CPI eased to 3.2% in November.

Against that backdrop, separate survey data suggest corporate sentiment is improving slightly. A quarterly CFO survey from Deloitte showed the net balance of business optimism rose to -13% in Q4 from -24% in Q3, though confidence remains below historical averages.

Deloitte’s chief economist Ian Stewart described sentiment as cautious but improving, noting reduced perceptions of external uncertainty and a modest pickup in risk appetite. Preliminary December PMI data from S&P Global echoed that view.

Notably, the share of executives prioritising capital expenditure rose to a two-and-a-half-year high of 17%, signalling tentative willingness to invest. Still, the contrast between improving confidence and persistent cost pressures suggests UK firms face a difficult balancing act in 2026.

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• Australia Services PMI Business Activity Index eased to 51.1 in December from 52.8 in November

  • Flash reading: Australia preliminary December PMI: Manufacturing 52.2 (prior 51.6) services 51.0 (52.8)

• Services activity expanded for a near two-year stretch

• Growth slowed to weakest pace since May

• New business and export demand strengthened

• Hiring accelerated, reducing outstanding workloads

• Input and output price pressures intensified

• Composite Output Index slipped to 51.0 from 52.6

Australia’s service sector continued to expand at the end of 2025, though momentum softened as capacity constraints and rising costs weighed on activity, according to the latest PMI data from S&P Global. While business activity growth slowed to its weakest pace since May, demand conditions remained resilient, supported by a solid rise in new business and continued strength in export-related services.

The seasonally adjusted Australia Services PMI Business Activity Index eased to 51.1 in December from 52.8 in November, remaining above the 50 threshold that separates expansion from contraction. The reading extended the current growth run to nearly two years, but confirmed a loss of momentum into year-end. Survey respondents cited capacity constraints as a key factor limiting output growth, even as demand conditions improved.

New business inflows rose at their fastest pace in three months, driven by stronger customer demand and an increase in client numbers late in the year. Export demand also contributed, with firms reporting another expansion in new work from overseas markets. The pickup in new orders suggests underlying demand remains supportive heading into early 2026, despite softer headline activity readings.

To meet rising workloads, service providers increased staffing levels at a solid pace. The rate of job creation was the strongest in three months, allowing firms to reduce outstanding business for the second time in three months. That combination points to improving operational capacity, even as growth remains constrained in the near term.

Business sentiment improved in December, with firms reporting greater optimism around output prospects for the year ahead. Expectations were supported by anticipated business development initiatives and hopes for expansionary government policies. That said, confidence levels remained below historical averages, reflecting ongoing caution around the broader economic outlook.

Price pressures were a key feature of the December survey. Input costs rose at a faster pace than in November, driven by higher material, energy and wage expenses. Firms responded by lifting output charges more quickly, raising the risk of services-led inflation pressures feeding into the broader economy.

At the composite level, overall business activity growth also softened. The Composite Output Index slipped to 51.0 from 52.6, marking the slowest expansion in seven months. However, new orders and employment growth accelerated, while confidence improved modestly.

According to Jingyi Pan, Economics Associate Director at S&P Global
Market Intelligence, the combination of softer activity growth but stronger new business points to continued expansion in coming months, though rising price pressures warrant close monitoring.

This article was written by Eamonn Sheridan at investinglive.com.

• US December ISM manufacturing index 47.9 vs 48.4 expected
• Fed’s Kashkari: My guess is we’re close to neutral now
• London copper prices hit a fresh record, touching $13,000 for the first time
• Novo Nordisk launches first oral Wegovy weight-loss pill in the US
• MicroStrategy purchases an additional $116 million in Bitcoin, expanding reserves
• Goldman Sachs upgrades Coinbase to “Buy” citing rising crypto trade volumes
• Ray Dalio warns AI boom entering early bubble phase for markets

Markets:

• Gold up $116 to $4446
• WTI crude up $1.07 to $58.35
• Bitcoin up 3%
• GBP leads, CAD lags
• S&P 500 up 0.6%
• US 10-year yields down 3.4 bps to 4.15%

Market moves on Monday were mostly about new-year positioning and the fallout from the Venezuelan ouster of Maduro, who plead not-guilty in a New York court today. Oil company stocks were the big winners, adding more than $60 billion in market cap for those with Venezuelan exposure/claims or with the potential to rebuild the country’s oil production capacity.

Gold, bitcoin and precious metals were higher on the bull market in US adventurism. It’s not just Venezuela but US officials quickly talked about Cuba and Greenland after the successful operation. That’s a strong case to be diversifying out of US dollars if you’re a central bank reserve manager and could be threatened by the USA.

Early in the day, the US dollar was stronger but in North American trade it was hit by steady selling. The pound was easily the best performer, doubling the second-place Australian dollar. The UK may have positioned itself as a US ally and alternative at the same time, something that could add to capital flows.

Notably, bonds were bid despite strong stock markets. That is likely the result of caution from some fund managers as we enter an increasingly hard-to-predict geopolitical era. Wars and coups are rarely isolated and tend to cluster; from time to time they even turn into world wars. Those kinds of tail risks are certainly rising and appreciated by the bond market and the rise in crude might also reflect that kind of assessment.

This article was written by Adam Button at investinglive.com.