KEY POINTS:

• Long Mag 7 is the most crowded trade for 54% of participants
• Long gold takes the second spot at 29%
• Global investors are the most bullish in 3 and a half years due to “run it hot” macro and policy expectations
• Allocation to stocks and commodities at the highest since 2022
• BofA says positioning is a “big headwind” for risk assets
• AI bubble remains the biggest tail risk

The Bank of America Fund Manager Survey is a monthly global poll of institutional investors, revealing sentiment, asset allocation and economic expectations to gauge market positioning and potential crowded trades.

THE REASON FOR SUCH EXPECTATIONS:

In the latest survey, we can see that Mag 7 and gold are the most crowded trades driven by the “run it hot” macro and policy expectations. That shouldn’t be surprising given Trump’s expansionary policies and continues attacks on the Fed to lower interest rates.

On the other hand, the Fed is also not doing much to counter the expectations by keeping a dovish reaction function. In fact, Fed Chair Powell in its latest press conference not only downplayed the inflation risk but emphasized the labour market weakness, suggesting that there’s more tolerance for higher inflation than for weaker labour market.

And adding to that, he stated that the debate among FOMC members is just about how much more to cut. This is called a “dovish reaction function” because they will cut rates in case we see more weakness in the data but won’t do anything in case things strengthen.

REPRICING IN RATE CUT BETS INFLUENCES THE SHORT-TERM:

This remains a tailwind for risk assets and gold in the medium-term. In the short-term, the repricing in the dovish expectations is what triggers the pullbacks/corrections.

In fact, the market’s expectations were very dovish going into the October’s FOMC decision, but Powell’s statement that a December cut was not a foregone conclusion triggered a repricing that weighed on risk assets. As soon as Fed’s Williams hinted that a December cut was coming, we saw a strong rebound across the board.

Now, we are in the same situation. We have the market pricing in 58 bps of easing by the end of 2026. That’s 33 bps more than what the Fed projected. This week we get the US NFP and CPI reports. The market might not like strong data as it would trigger a hawkish repricing in interest rate expectations and lead to a deeper pullback. On the other hand, benign or even soft data will highly likely support risk assets.

This article was written by Giuseppe Dellamotta at investinglive.com.

• Prior -78.7
• Economic sentiment 45.8 vs 38.7 expected
• Prior 38.5

The current conditions index might show a slight decline but there is a major beat on the expectations outlook. So, that really outweighs the headline reading here. ZEW notes that expectations have become more positive and that chances for a recovery of the economy are looking good, which is being reflected in the sentiment among investors. The key boon of course being a more expansive fiscal policy, which is expected to provide new momentum to the German economy.

That’s a positive note at least but nothing that will get the ECB moving just yet as German price pressures remain a key sticking point. EUR/USD remains little changed on the day at 1.1757 currently.

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

• Prior €19.4 billion; revised to €18.4 billion

Compared to the month of October last year, exports to the US are seen down nearly 15% this October while imports are up just a little over 4%. That sees the trade surplus with the US narrow in October this year to €11.2 billion with it being €19.5 billion in 2024. Something, something tariffs I guess.

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

The post Ex-Dividend 17/12/2025 first appeared on IC Markets | Official Blog.

The post Ex-Dividend 16/12/2025 first appeared on IC Markets | Official Blog.

• Prior 51.3
• Manufacturing PMI 51.2 vs 50.4 expected
• Prior 50.2
• Composite PMI 52.1 vs 51.6 expected
• Prior 51.2

These are nice beats, but the commentary isn’t as good. The agency cites lacklustre growth, worryingly widespread job losses and renewed upturn in selling price inflation across both goods and services.

It keeps the BoE on track to cut rates on Thursday, but the central bank will likely sound more cautious on the next moves, remaining highly data-dependent.

Key Findings:

• Output growth accelerates in December, led by
  sharpest rise in new business for 14 months

Comment:

Chris Williamson, Chief Business Economist at S&P
Global Market Intelligence:

“December’s flash PMI surveys brought welcome news on
faster economic growth at the end of the year, with businesses
buoyed in part by the post-Budget lifting of uncertainty. The
PMI is consistent with GDP growth accelerating to 0.2% in
December, albeit with a more modest 0.1% gain signalled for
the fourth quarter as a whole.

“It’s a big relief that business confidence has not slumped in a
repeat of last year’s post-Budget gloom. Instead, companies
have ended the year on a slightly more optimistic note amid
signs of improving demand now that some of the uncertainty
created by the Budget has cleared. New orders are in fact
growing at the fastest rate for over a year.

“However, the overall pace of output and demand growth
remains lacklustre, and the expansion is still very dependent
on technology and financial services activity, with many other
parts of the economy struggling to grow or in decline.

“Job losses are also again worryingly widespread, and it
remains to be seen whether the uptick in orders during
December will persuade more companies to start hiring again,
especially as rising staff costs continue to be reported as one
of the key concerns of businesses. These higher cost pressures
were in turn cited as the key cause of a renewed upturn in
selling price inflation across both goods and services.

“The sluggish growth and worrying jobs data from the flash
PMI data therefore suggest that the odds remain in favour of
a further cut to interest rates at the December MPC meeting,
but that the path to further rate cuts in 2026 remains very data
dependent, as policymakers await confirmation that price
pressures are going to soften materially as the year proceeds.”

This article was written by Giuseppe Dellamotta at investinglive.com.

• Prior 1.2%
• HICP +1.1% vs +1.1% y/y prelim
• Prior +1.3%

Slight delay in the release by the source. Core annual inflation is seen slowing down from 1.9% to 1.7% in November, so that’s something to at least take note of. That said, the sticking point for inflation for the ECB is still very much the German economy at this point. So, that’s going to continue to keep them boxed in the current position of not moving on rates.

As things stand, traders are not anticipating any major moves by the ECB even through to next year. That being said, things can still change depending on data developments in the months ahead. But for now, the outlook seems to be clear that the ECB won’t be afforded much room to make another move in terms of rate cuts. And policymakers are also of the same view with markets at the very least, even if they would like some added flexibility as an option.

EUR/USD trades at 1.1753 currently, having little to do on the day amid a more mixed PMI showing with little to offer before we get to the slew of US data later. Large option expiries at 1.1750 will continue to keep things in check, acting as a magnet for price action in European trading at least.

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

• Prior 53.6
• Manufacturing PMI 49.2 vs 49.9 expected
• Prior 49.6
• Composite PMI 51.9 vs 52.7 expected
• Prior 52.8

After the downcast from the German numbers, this was well expected. Both the services and manufacturing prints are softer than estimated, pushing down overall activity in the euro area for December. That said, it still marks another expansion in activity at least to wrap up the year. That won’t change much for the ECB outlook as such. EUR/USD continues to trade near unchanged on the day at 1.1752 with large option expiries seen at 1.1750. HCOB notes that:

“Economic growth slowed at the end of the year due to a slight contraction in the manufacturing sector and weaker
momentum in the service sector. The weaker performance is primarily attributable to German industry, where the downturn
intensified. In France, on the other hand, there are signs of a cautious recovery in industry, although a single monthly figure
should not be overrated. However, the service sector, which had expanded last month, is stagnating there, while Germany’s
service companies saw another solid rise in activity. All in all, the runway into the new year seems pretty unstable.

“Despite a softening of growth, the service sector continues to look relatively robust. Companies have no reason to complain
about new business and are therefore hiring additional staff. Looking ahead, however, companies have become somewhat
more cautious, which is likely due in part to the decline in order backlogs. We expect the service sector to continue to play a
stabilising role for the economy as a whole in the coming year. However, a real upturn will only succeed if the manufacturing
sector regains its footing.

“Cost inflation in the service sector reached its highest rate in nine months in December. The European Central Bank, which
is meeting on December 18 and is monitoring service inflation particularly closely, is likely to see its publicly stated policy of
leaving interest rates unchanged confirmed. It is clear that price pressure, driven in part by wage increases, is still
noticeable.”

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

• Prior 48.2
• Services PMI 52.6 vs 53.0 expected
• Prior 53.1
• Composite PMI 51.5 vs 52.4 expected
• Prior 52.4

This is in contrast to the better than expected French PMIs. In fact, the gains seen in the euro following the French release got erased. Overall, this doesn’t change anything for the ECB though. The central bank will likely maintain its neutral stance and keep monitoring economic developments.

Comment:

Commenting on the flash PMI data, Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, said:

“What a mess, one might exclaim in view of the further downturn in the manufacturing sector. For the second month in a
row, the headline manufacturing PMI has fallen deeper into sub-50 contraction territory, and for the first time in ten months,
production is also declining. The latter comes as no surprise, as order intakes had already slumped in November. This trend
has now continued, which does not bode well for the start of next year.

“Despite warning lights flashing in the industry, there are significantly more manufacturing companies looking ahead to the
coming year with confidence in December. The corresponding index has jumped upwards, possibly reflecting the fact that
the government has launched a number of transport projects, decided on reforms to reduce bureaucracy, and wants to
expand defence capabilities. Only if these measures result in an increase in incoming orders will the industry regain
momentum.

“The service sector is losing momentum for the second month in a row. However, business activity continues to grow visibly,
as evidenced by the stronger expansion of staff. New business has been increasing steadily for three months and overall,
the service sector is stabilizing the economy as a whole and is likely to contribute significantly to positive GDP growth in the
fourth quarter.

“While confidence in the manufacturing sector has increased visibly, the assessment of the next 12 months in the service
sector has weakened in December. It is possible that people believe that the economic stimulus package and higher
defence spending will primarily benefit construction companies, the mechanical engineering sector, and companies that
produce directly or as suppliers in the defence sector, while service providers tend to come away empty-handed.

“However,
this does not have to be the case, because industrial production usually also involves activities that are accompanied by
service providers such as consulting firms, auditors, and software developers. In addition, there are the so-called multiplier
effects, because employees of companies that receive additional (government) orders are more likely to treat themselves to
an extra visit to a restaurant or a concert that they would otherwise have foregone.”

This article was written by Giuseppe Dellamotta at investinglive.com.

• Prior 51.4
• Manufacturing PMI 50.6 vs 48.1 expected
• Prior 47.8
• Composite PMI 50.1 vs 50.3 expected
• Prior 50.4

It’s a polarising release with the French services sector slumping in December while the manufacturing sector posts a beat on activity. At the balance though, it still leads to a bit of a drag to the French economy with overall activity basically stagnating in the final month of the year. Looking at the details, employment conditions held up while price developments were little changed compared to November. HCOB notes that:

“French private sector business conditions appear largely static in December. The HCOB flash PMI remains marginally in
growth territory, yet it signals a softer expansion compared to the prior month, reflecting an economy still weighed down by
uncertainty among households and firms. Beneath the surface, however, sectoral adjustments have occurred: manufacturing
stabilised, whereas services lost momentum, leaving the aggregate picture flat and the overall French economy sluggish.

“The flash Manufacturing PMI managed a modest climb past the 50.0-point mark as the year drew to a close. December
brought encouraging signs in indices for both output and order books, with foreign demand providing a notable lift. Another
optimistic reading of the Future Output Index and a renewed willingness among firms to expand their workforces provides a
positive signal for the outlook.

“However, so long as no budget is passed by the government, political uncertainty will remain a noticeable headwind for
France’s economy. The passage of the social security budget is at least a small victory for Prime Minister Lecornu. However,
subdued consumer sentiment and intense international competitive pressures from the likes of the US and China diminish
growth prospects. The recently robust aviation industry could offer a glimmer of hope for the future by providing additional
impetus to the manufacturing sector more broadly.”

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

DXY (U.S. Dollar Index):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 98.77

Supporting reasons: Identified as a pullback resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 97.97

Supporting reasons: Identified as an overlap support that aligns with the 161.8% Fibonacci extension, indicating a potential area where the price could again stabilize.

1st resistance: 99.06
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 1.1710

Supporting reasons: Identified as a pullback support, where renewed buying pressure could emerge to push the price higher.

1st support: 1.1644

Supporting reasons: Identified as a pullback support, indicating a potential level where the price could stabilize once again.

1st resistance: 1.1810

Supporting reasons: Identified as a swing high resistance that aligns closely with the 100% Fibonacci projection, indicating a potential level that could cap further upward movement.

EUR/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 181.69

Supporting reasons: Identified as a pullback support that aligns with the 50% Fibonacci retracement, where renewed buying pressure could emerge to push the price higher.

1st support: 179.92
Supporting reasons: Identified as a pullback support, indicating a potential area where the price could again stabilize.

1st resistance: 183.02
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.

EUR/GBP:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 0.8749

Supporting reasons: Identified as a pullback support, where renewed buying pressure could emerge to push the price higher.

1st support: 0.8722
Supporting reasons: Identified as a multi-swing low support, indicating a potential area where the price could stabilize once more.

1st resistance: 0.8799
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

GBP/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 1.3353

Supporting reasons: Identified as a pullback support, where renewed buying pressure could emerge to push the price higher.

1st support: 1.3287
Supporting reasons: Identified as an overlap support, indicating a potential area where the price could stabilize once more.

1st resistance: 1.3452
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could halt further upward movement.

GBP/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 207.17

Supporting reasons: Identified as an overlap resistance that aligns with the 50% Fibonacci retracement, where selling pressures could intensify and potentially cap any upward retracement

1st support: 205.32
Supporting reasons: Identified as an overlap support, indicating a potential level where the price could stabilize once more.

1st resistance: 208.94
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could halt further upward movement.

USD/CHF:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 0.7987

Supporting reasons: Identified as a pullback resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 0.7926
Supporting reasons: Identified as a pullback support that aligns with the 78.6% Fibonacci retracement, indicating a potential level where the price could stabilize once again.

1st resistance: 0.8028
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

USD/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bullish

The price has already reacted off the pivot and may continue its bearish move toward the 1st support.

Pivot: 155.34

Supporting reasons: Identified as an overlap resistance, where selling pressures could intensify and potentially cap any upward retracement

1st support: 153.26

Supporting reasons: Identified as a swing low support that aligns closely with the 127.2% Fibonacci projection, indicating a strong area where buyers might return, and the price could stabilize once again.

1st resistance: 156.95

Supporting reasons: Identified as a swing high resistance. This level represents the next key area where upward movement could be capped amid increased selling pressure

USD/CAD:

Potential Direction: Bearish                                                                                                                                                                                       

Overall momentum of the chart: Bearish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 1.3890

Supporting reasons: Identified as a pullback resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 1.3768

Supporting reasons: Identified as a swing low support, indicating a key level where the price could stabilize once more.

1st resistance: 1.3960

Supporting reasons: Identified as an overlap resistance, making it a possible target for bullish advances and a level where some sellers could return to cap gains

AUD/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 0.6622

Supporting reasons: Identified as an overlap support that aligns with the 23.6% Fibonacci retracement, where renewed buying pressure could emerge to push the price higher.

1st support: 0.6572

Supporting reasons: Identified as a pullback support that aligns with the 38.6% Fibonacci retracement, this area has provided strong support historically and may attract buying interest for a potential short-term bounce

1st resistance: 0.6684

Supporting reasons: Identified as an overlap resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bearish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 0.5796

Supporting reasons: Identified as an overlap resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 0.5743

Supporting reasons: Identified as a pullback support that aligns with the 38.2% Fibonacci retracement, this area has provided strong support historically and may attract buying interest for a potential short-term bounce

1st resistance: 0.5831

Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 48,000

Supporting reasons: Identified as a pullback support that aligns with the 61.8% Fibonacci retracement, where renewed buying pressure could emerge to push the price higher.

1st support: 47,372.40

Supporting reasons: Identified as a pullback support, suggesting a potential area where the price could stabilize once again.

1st resistance: 48,879.50

Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 23,945.80

Supporting reasons: Identified as a pullback support, where renewed buying pressure could emerge to push the price higher.

1st support: 23,488.00

Supporting reasons: Identified as a pullback support, indicating a key level where the price could stabilize once more.

1st resistance: 24,444.50

Supporting reasons: Identified as a swing high resistance that aligns with the 100% Fibonacci projection, indicating a potential area that could halt any further upward movement.

US500 (S&P 500):

Potential Direction: Bullish  

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 6,773.23

Supporting reasons: Identified as a pullback support that aligns with the 38.2% Fibonacci retracement, where renewed buying pressure could emerge to push the price higher.

1st support: 6,673.25

Supporting reasons: Identified as an overlap support that aligns with the 61.8% Fibonacci retracement, indicating a potential level where the price could stabilize once again.

1st resistance: 6,920.20

Supporting reasons: Identified as a swing high resistance, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 88,893.73

Supporting reasons: Identified as a pullback resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 81604.89

Supporting reasons: Identified as a swing low support, indicating a potential level where the price could stabilize once more.

1st resistance: 94,626.23

Supporting reasons: Identified as an overlap resistance that aligns with the 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 3,180.10

Supporting reasons: Identified as an overlap resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 2,904.01

Supporting reasons: Identified as an overlap support that aligns with the 61.8% Fibonacci projection, indicating a potential level where the price could stabilize once more.

1st resistance: 3,404.43
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bearish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before continuing its bearish move down toward the 1st support.

Pivot: 57,52

Supporting reasons: Identified as a pullback resistance, where selling pressures could intensify and potentially cap any upward retracement.

1st support: 56.38
Supporting reasons: Identified as a swing low support that aligns with the 127.2% Fibonacci extension and the 100% Fibonacci projection, indicating a key level where the price could stabilize once more.

1st resistance: 58.35
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price could see a short-term pullback toward the pivot before rising again toward the 1st resistance.

Pivot: 4,255.04

Supporting reasons: Identified as a pullback support, where renewed buying pressure could emerge to push the price higher.

1st support: 4,145.75
Supporting reasons: Identified as a pullback support, indicating a key level where the price could stabilize once more.

1st resistance: 4,366.45
Supporting reasons: Identified as a swing high resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

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The post Tuesday 16th December 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Global – Asia Fundamental Forecast | 16 December 2025

What happened in the U.S. session?

The U.S. session, markets traded in a consolidative, slightly risk‑on tone as investors positioned for a barrage of U.S. macro releases, including delayed jobs data, CPI, and retail sales that will refine expectations for the Fed’s 2026 easing path. U.S. indices saw mixed but generally stabilizing price action, with the S&P 500 and Dow attempting to recover from last week’s tech‑driven rout while the Nasdaq lagged on renewed concerns about AI‑related spending and profitability. U.S. Treasury yields nudged higher, and the curve steepened, supporting a marginally firmer dollar index, even as markets continued to embed additional cuts over the next year.

What does it mean for the Asia Session?

For Asian desks, the focus is on a synchronized run of PMIs from Japan and the eurozone, UK labour statistics, and a delayed US Employment Situation report paired with retail sales that together could reset expectations for global growth and major central‑bank paths. A softer‑than‑expected US jobs print or weak retail numbers would likely reinforce the medium‑term bearish tone in the dollar and favour EUR, GBP, AUD, and gold, while also pressuring risk assets on growth worries, whereas resilient employment and spending could revive USD strength and support equities and oil.

The Dollar Index (DXY)

Key news events today

ADP Weekly Employment Change (Tentative)

Average Hourly Earnings m/m (1:30 pm GMT)

Core Retail Sales m/m (1:30 pm GMT)

Non-Farm Employment Change (1:30 pm GMT)

Retail Sales m/m (1:30 pm GMT)

Unemployment Rate (1:30 pm GMT)

Flash Manufacturing PMI (2:45 pm GMT)

Flash Services PMI (2:45 pm GMT)

What can we expect from DXY today?

The U.S. dollar is trading with a soft, bearish tone today as markets continue to fade last week’s “hawkish” Fed cut and position ahead of a heavy data slate starting with the delayed jobs report on December 16. The Dollar Index has broken key support and remains in a pattern of lower highs and lower lows, reinforcing a medium‑bearish technical backdrop even as it holds slightly above levels seen a few months ago. 

Central Bank Notes:

• The Federal Open Market Committee (FOMC) is widely expected to lower the federal funds rate target range by 25 basis points to 3.50%–3.75% at its December 9–10, 2025, meeting, marking the third consecutive cut after the October reduction to 3.75%–4.00%
• The Committee continues to pursue maximum employment and 2% inflation goals, with the labor market showing further softening as the unemployment rate rose to 4.4% in September 2025 amid modest job gains.
• Officials note persistent downside risks to growth alongside resilient activity, with inflation easing to 3.0% year-over-year CPI in September but remaining elevated due to tariff effects; core PCE stands at around 2.8% as of October.
• Economic activity grew at a 3.8% annualized pace in Q2 2025 per revised estimates, though Q3 and Q4 face headwinds from trade tensions, fiscal restraint, and data disruptions like the government shutdown.
• September’s Summary of Economic Projections forecasts 2025 unemployment at a median 4.5%, with PCE inflation near 3.0% and core PCE at 3.1%, signaling a gradual disinflation path; updates expected on December 10 may adjust for higher unemployment and lower growth.
• The Committee maintained its data-dependent approach, noting a softening labor market and inflation above the 2% target, while deciding to lower the federal funds rate target range by 25 basis points to 3.50%-3.75%. Dissent persisted, with multiple members opposing the cut or advocating for a hold, reflecting divisions similar to recent meetings.​
• The FOMC confirmed the conclusion of its quantitative tightening program effective December 1, 2025, with Treasury rolloff caps at $5 billion per month and agency MBS caps at $35 billion per month to ensure ample reserves and market stability.
• The next meeting is scheduled for 27 to 28 January 2026.

Next 24 Hours Bias

Medium Bearish 

Gold (XAU)

Key news events today

ADP Weekly Employment Change (Tentative)

Average Hourly Earnings m/m (1:30 pm GMT)

Core Retail Sales m/m (1:30 pm GMT)

Non-Farm Employment Change (1:30 pm GMT)

Retail Sales m/m (1:30 pm GMT)

Unemployment Rate (1:30 pm GMT)

Flash Manufacturing PMI (2:45 pm GMT)

Flash Services PMI (2:45 pm GMT)

What can we expect from Gold today?

Gold is trading near record territory on Tuesday, hovering around the 4,330–4,350 USD/oz area after a powerful multi‑week rally fuelled by Federal Reserve rate cuts, softer real yields, and strong safe‑haven demand. The short‑term tone is still bullish, but momentum is moderating, with intraday focus on whether upcoming U.S. labour data later today will push prices to retest October’s all‑time highs around 4,380–4,400 USD/oz or trigger a consolidation from elevated levels.

Next 24 Hours Bias
Strong Bullish

The Australian Dollar (AUD)

Key news events today

No major news event

What can we expect from AUD today?

The Australian Dollar enters Tuesday on a firm footing, trading just below recent highs as markets digest a steady but hawkish RBA, softer but still resilient domestic data, and a comparatively more dovish Federal Reserve backdrop. While lingering concerns about China’s growth and patchy labour figures could cap further near‑term gains, the combination of supportive yield differentials and expectations for stable to slightly higher Australian rates keeps sentiment toward the AUD constructive in the short to medium term.

Central Bank Notes:

• The Reserve Bank of Australia held its cash rate steady at 3.60% at the November 2025 policy meeting, adopting a cautious tone amid a surprise uptick in inflation data for the September quarter. This marks the fourth consecutive pause since the 25 basis point cut in August. The Board attributed some of the inflation rise to temporary factors like higher petrol prices and council rates, but noted signs of more persistent pressures from consumer demand.​
• Policymakers emphasized vigilance on inflation, with trimmed mean inflation expected to remain elevated in the near term before nearing the 2–3% target midpoint by mid-2027. Recent data showed underlying inflation staying above target until at least the second half of 2026, prompting upward revisions to forecasts. Capacity pressures are seen as slightly more pronounced than previously assessed, delaying any easing.
• Headline CPI for the September quarter exceeded expectations, driven partly by temporary items, while underlying measures signal ongoing stickiness. The shift to monthly CPI reporting, with the first full edition in November 2025, will enhance real-time inflation monitoring. Housing and services remain resilient contributors to price pressures.
• Domestic demand shows firmness in services alongside below-trend growth elsewhere, with capacity pressures not expected to ease significantly. The labor market is gradually softening, with unemployment projected to stabilize around 4.4%, though wage growth and productivity dynamics keep unit labor costs a concern. Household spending faces headwinds from high borrowing costs.​
• Global risks include geopolitical tensions and commodity volatility, set against modestly revised-up world growth outlooks. The Board describes its policy as mildly restrictive and data-dependent, balancing inflation control with employment goals. No rate hike was considered despite the inflation surprise.
• Monetary policy remains mildly restrictive to address lingering price stability risks amid household and global vulnerabilities. Communications reaffirm the dual mandate of 2–3% inflation and full employment, with readiness to adjust based on incoming data.​
• Market expectations point to the cash rate holding through early 2026, with a possible modest cut to 3.3% mid-year if inflation eases as forecast. The new monthly CPI data will be key for timely insights.
• Monetary policy remains mildly restrictive, balancing progress on price stability against vulnerabilities in household demand and global outlook. Board communications reaffirm a dual mandate: price stability and full employment, while underscoring readiness to respond should risks materialize sharply.
• Analysts generally expect the cash rate to remain at current levels through early 2026, with only modest cuts possible later in the year if inflation moderates. The new monthly CPI release (first full edition Nov 2025) will be watched closely for timely signals on price trends.
• The next meeting is on 2 to 3 February 2026.

Next 24 Hours Bias

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news event

What can we expect from NZD today?

The New Zealand Dollar is holding firm near the 0.58 level against the US Dollar after a recent climb to multi‑week highs, underpinned by expectations that the Reserve Bank of New Zealand is nearing the end of its rate‑cut cycle and by a softer US Dollar. However, lingering concerns about the strength of China’s recovery and the global growth outlook are tempering bullish momentum, leaving the NZD in a consolidative range as traders await the next round of key data and central‑bank signals.

Central Bank Notes:

• The Monetary Policy Committee (MPC) left the Official Cash Rate (OCR) unchanged at 2.25% at its 26 November 2025 meeting, following the widely anticipated 25-basis-point reduction from 2.50%, and signaled that policy is now firmly in stimulatory territory while keeping the option of further easing on the table if needed.
• The decision was again reached by consensus, with members judging that the cumulative 325 basis points of easing over the past year warranted a period of assessment, even as several emphasized a willingness to cut further should incoming data point to a more protracted downturn or renewed disinflationary pressures.
• Headline consumer price inflation is projected to hover near 3% in late 2025 before gradually easing toward the 2% midpoint of the 1–3% target band through 2026, supported by contained inflation expectations around 2.3% over the two-year horizon and an expected pickup in spare capacity.
• The MPC noted that domestic demand remains subdued but shows tentative signs of stabilisation, with softer household spending and construction only partially offset by improving services activity; nevertheless, policymakers still expect services inflation to ease as wage growth moderates and the labour market loosens further over the coming year.
• Financial conditions continue to ease as wholesale and retail borrowing rates reprice to the lower OCR, contributing to gradually rising mortgage approvals and improving housing-related sentiment, although broader business credit growth remains patchy and sensitive to uncertainty about the durability of the recovery.
• Recent data confirm that GDP momentum is weak but not deteriorating as sharply as earlier in 2025, with high-frequency indicators pointing to a shallow recovery from a low base and ongoing headwinds from elevated living costs and fragile confidence weighing on discretionary consumption and investment.
• The MPC reiterated that external risks remain skewed to the downside, particularly from softer Chinese demand and uncertainty around United States trade policy, but noted that a lower New Zealand dollar continues to provide some offset via improved export competitiveness and support for tradables inflation.
• Looking ahead to early 2026, the Committee maintained a mild easing bias, indicating that a further cut toward 2.00–2.10% cannot be ruled out if activity fails to gain traction or if inflation undershoots projections, but current forecasts envisage the OCR remaining near 2.25% for an extended period provided inflation converges toward target and the recovery proceeds broadly as expected.
• The next meeting is on 18 February 2026.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news event

What can we expect from JPY today?

Today, the Japanese yen is trading slightly firmer around the mid‑155 per dollar area, benefitting from safe‑haven demand and rising expectations that the Bank of Japan will hike rates from 0.5% to 0.75% at this week’s policy meeting, even as it remains weak by historical standards. Improved business confidence readings and persistent concern over past yen weakness have encouraged markets to price in a more hawkish BoJ path, while simultaneous bets on further Federal Reserve rate cuts have narrowed US‑Japan yield differentials and pressured USD/JPY off its recent highs near 157–158.

Central Bank Notes:

• The Policy Board of the Bank of Japan met on 30–31 October and, by a clear majority vote, decided to maintain its key monetary policy approach for the upcoming period.
• The BOJ will continue to encourage the uncollateralized overnight call rate to remain at around 0.5%, in line with the prior stance.
• The gradual quarterly reduction in monthly outright purchases of Japanese Government Bonds (JGBs) remains intact, with amounts unchanged from the previous schedule. Purchases are set to decrease by about ¥400 billion per quarter through March 2026, shifting to about ¥200 billion per quarter from April to June 2026, and targeting a ¥2 trillion purchase level for Q1 2027. The bank reaffirmed its intention to maintain flexibility, with readiness to respond if market conditions warrant an adjustment.
• Japan’s economy continues to show moderate recovery, primarily led by solid capital expenditures, although export growth and corporate activity remain restrained by external demand uncertainty and the ongoing effects of U.S. trade policies.
• Annual headline inflation (excluding fresh food) accelerated to 2.9% year-on-year in September, marking the first uptick in four months and staying above the BOJ’s 2% target. Broad-based inflation persists, with food and energy cost pressures, but wage growth continues to support household consumption. Input cost pressures from the earlier surge in imports eased slightly.
• Short-term inflation momentum could moderate as food-price hikes ease, though rent, healthcare, and service-sector price increases tied to labor shortages provide support. Firms and households maintain a gradual upward drift in inflation expectations.
• For the near term, BOJ projects growth below trend as external demand stays subdued and corporate investment plans remain cautious. Still, accommodative financial conditions and steady gains in real labor income will underpin domestic consumption.
• Over the medium term, as overseas economies recover and trade conditions normalize, Japan’s growth potential should improve. Persistent labor market tightness, higher wage settlements, and rising medium- to long-term inflation expectations are expected to keep core inflation on a gradual upward trajectory, converging toward the 2% price stability target later in the forecast horizon.
• The next meeting is scheduled for 18 to 19 December 2025.

Next 24 Hours Bias

Medium Bearish

Oil

Key news events today

API Crude Oil Stock (8:30 pm GMT)

What can we expect from Oil today?

Today’s oil market tone is cautiously weak‑to‑neutral: prices are stabilising just above recent lows, but sentiment remains weighed down by expectations of ample supply and rising inventories, with rallies seen as vulnerable unless there is a clear bullish surprise on demand or a fresh supply disruption.

Next 24 Hours Bias
Medium Bearish

The post IC Markets Global – Asia Fundamental Forecast | 16 December 2025 first appeared on IC Markets | Official Blog.