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The first trading week of the new year has come and gone, and it is very much a case of so far, so good for investors. Risk sentiment has remained resilient, with global equity markets continuing to trade near record levels despite elevated geopolitical tensions and the first major US data release of the year.

US employment data on Friday came in relatively close to market expectations, locking in a hold from the Fed this month but also encouraging market pricing of more rate cuts later in the year.

It looks like being another busy week ahead, with geopolitical tensions likely to remain high across the globe, more key US data due out, and the first earnings reports of 2026 scheduled.

Here is our usual day-by-day breakdown of the major risk events this week:

It is a quiet start on the economic calendar on Monday, with very little scheduled across all three trading sessions. Japanese markets are closed for a bank holiday, which may affect liquidity early in the day; however, most traders are expecting updates on geopolitical events to drive any fresh moves.

There is little scheduled again in the first two trading sessions on Tuesday; however, things should get interesting once New York enters the fray, with the main event of the week, the US CPI data release, scheduled shortly after the open. US New Home Sales numbers are also set to be released; however, expect the inflation numbers to dominate.

It’s a very similar setup on Wednesday for investors, with little scheduled in the Asian and London sessions but more key data in the US. This time, it is US PPI numbers scheduled alongside the latest Retail Sales numbers. We also hear from Fed members Miran, Kashkari, and Williams during the day.

There is little again of note on the calendar in the Asian session; however, there will be a strong focus on UK markets once Europe opens, with the key UK GDP data due for release. There is more US data scheduled shortly after the US open, with Weekly Unemployment Claims, the Empire State Manufacturing Index, and the Philly Fed Manufacturing Index numbers all due out at the same time. Fed members Barkin and Bostic are also scheduled to speak.

It is a quiet Friday to close out the trading week, with little scheduled across all three trading sessions again; however, traders will continue to monitor newswires for fresh geopolitical updates for any changes in sentiment.

The post The Week Ahead – Week Commencing 12 January 2026 first appeared on IC Markets | Official Blog.

US Stocks Hit Record Levels After Weaker Non-Farms – S&P up 0.65%
US equity markets extended their rally on Friday, with stocks closing at or near record levels after US employment data came in slightly below expectations. The Dow gained 0.48% to close at 49,504, while the S&P 500 rose 0.65% to 6,966, and the Nasdaq outperformed with a 0.81% advance to finish at 23,671. Despite the softer headline jobs data, the unemployment rate fell, and shorter-dated US yields pushed higher. The US 2-year Treasury yield climbed 4.4 basis points to 3.532%, while the 10-year yield was little changed, slipping 0.2 basis points to 4.165%. The shift in rate expectations supported the US dollar, with the dollar index rising 0.30% to 99.17. In commodities, oil prices surged again as geopolitical tensions intensified following reports of further unrest in Iran. Brent jumped 2.18% to $63.34 per barrel, while WTI gained 2.35% to $59.12. Gold also attracted strong haven demand, pushing back through the $4,500 level, with the metal rising 0.77% to trade at $4,510.15 by the NY close.

Fed Rate Cuts Still in Play for 2026 After Non-Farms
Rate cuts from the Federal Reserve Bank are still in play this year for the market after the first major data release of 2026 came in close to expectations. Non-Farm Payroll data came in slightly under expectations; however, the Unemployment Rate dropped more than expected, by 0.2% rather than the expected 0.1%, and Average Hourly Earnings did increase by the anticipated 0.2% m/m. The market is now pricing in just a 5% chance of a further rate cut from the Fed at this month’s meeting, but we have seen a bigger change in the March meeting pricing, with the chances of a 25-basis point cut slipping from over 40% a week ago to under 30% now. Traders will now be focussing on key inflation data out of the US this week, and if it remains ‘sticky’, as it has done over the last year, then we can expect those rate cut expectations to pull back further and add more support to the dollar, which has crept up nearly 1% since the start of 2026.

Quiet Calendar Start to Another Busy Trading Week
It is a quiet start to the trading week on the economic calendar, with very little in the form of tier 1 events scheduled; however, geopolitical updates are likely to see more moves in markets as the day progresses. Japan is closed for a bank holiday during the Asian session, which may see a reduction in liquidity. The European session is also set to be relatively quiet in terms of scheduled events. In the US session, there is also little in the way of data scheduled; however, markets will be watching comments from FOMC member Thomas Barkin, who is scheduled to speak later in the day – with his and other Fed members’ comments likely to be under the microscope in the coming days after the big data update on Friday.

Explore all upcoming market events in the Economic Calendar.

The post General Market Analysis – 12/01/26 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei up 1.61%, Shanghai Composite up 0.74%, Hang Seng up 0.93% ASX up 0.48%
• Commodities : Gold at $4,583.21 (+1.83%), Silver at $83.552 (+5.32%), Brent Oil at $63.46 (+0.19%), WTI Oil at $59.24 (+0.51%)
• Rates : US 10-year yield at 4.183, UK 10-year yield at 4.3770, Germany 10-year yield at 2.8256

News & Data:

• (USD) Unemployment Rate 4.4% to 4.5% expected
• (USD) Non-Farm Employment Change 50K to 66K expected
• (USD) Unemployment Rate 6.8% to 6.7% expected
• (CAD) Employment Change 8.2K to -1.8K expected

Markets Update:

Asian stock markets are trading mostly higher on Monday, tracking broadly positive cues from Wall Street as optimism grows over the outlook for U.S. interest rates. Sentiment was boosted after a report showed U.S. employment rose less than expected in December, reinforcing confidence that the Federal Reserve could begin cutting rates later this year. While the Fed is still widely expected to keep rates unchanged at its January 27–28 meeting, investors view recent data as supportive of a more accommodative stance ahead. Asian markets had also closed mostly higher on Friday.

Positive sentiment was further supported by a report indicating U.S. consumer sentiment improved slightly more than expected in January. According to CME Group’s FedWatch Tool, markets are pricing in a 95 percent probability that the Fed will leave rates unchanged at its upcoming meeting.

The Australian share market is notably higher, rebounding from the previous session’s losses. The benchmark S&P/ASX 200 index has moved above the 8,750 level, with gains across most sectors led by energy and technology stocks, while iron ore miners lagged. Major banks, gold miners and oil stocks are all trading higher, contributing to the market’s strength.

In Asia, South Korea and Taiwan are posting solid gains, while China, Hong Kong, Singapore, Malaysia and Indonesia are modestly higher. New Zealand is relatively flat, and Japan’s market is closed for the Coming of Age Day holiday.

On Wall Street, U.S. stocks ended Friday firmly higher, with the Dow and S&P 500 closing at fresh record highs. European markets also advanced, while crude oil prices jumped on supply concerns and ongoing geopolitical tensions.

Upcoming Events:

• 09:30 AM GMT – USD Sentix Investor Confidence

The post Monday 12th January 2026: Asian Markets Advance on Rate-Cut Optimism, Tracking Wall Street Gains first appeared on IC Markets | Official Blog.

IC Markets Global – Europe Fundamental Forecast | 12 January 2026

What happened in the Asia session?
During the Asia session on January 12, 2026, financial markets opened with Asian equities poised to extend US gains from Friday’s strong jobs data, while oil prices climbed amid intensifying protests in Iran. Key macroeconomic data releases included Australia’s TD-MI inflation gauge and New Zealand’s business confidence survey, providing early signals on regional price pressures and RBNZ expectations, though Japanese markets remained closed for a holiday.

What does it mean for the Europe & US sessions?
Global equities started 2026 strongly, with TSX and S&P 500 near records, driven by Fed rate cut hopes, though tech lagged behind materials and financials. Wall Street futures point lower ahead of payroll data, while basic materials gained 4.5% last week on metal rallies. Bank earnings from JPMorgan and others kick off next week, boosting sector optimism.

The Dollar Index (DXY)

Key news events today

No major news event

What can we expect from DXY today?

The US Dollar maintained upward momentum from last week’s rally, buoyed by resilient US data and cautious Fed cut bets, holding firm near 98.8 on the DXY amid key data ahead like CPI and NFP; it gained versus the euro, won, and others, though analysts eye potential dovish risks from Fed leadership shifts under President Trump.

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 labour 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% annualised pace in Q2 2025, according to revised estimates. However, Q3 and Q4 are expected to face headwinds from trade tensions, fiscal restraint, and data disruptions, such as the government shutdown.
• September’s Summary of Economic Projections forecasts 2025 unemployment at a median of 4.5%, with PCE inflation near 3.0% and core PCE at 3.1%, signalling 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 labour 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

No major news event

What can we expect from Gold today?

Gold remains bullish longer-term, with January forecasts varying from stabilization near $4,337 to upside toward $4,548, driven by macro releases and global risks. Traders are advised to buy dips in the current pullback, targeting potential highs around $4,800 amid elevated volatility. Overall, sentiment leans cautious yet optimistic for precious metals.

Next 24 Hours Bias   
Strong Bullish

The Euro (EUR)

Key news events today

No major news event

What can we expect from EUR today?

The Euro faced mild declines in EUR/USD forecasts, anticipating a brief rally to 1.1705 before resuming a downtrend toward 1.0935, influenced by technical patterns like Head and Shoulders and RSI signals. Local rate adjustments, such as in Uzbekistan, underscored euro softening against a strengthening dollar and ruble, while broader Eurozone inflation dips to 2% in Germany and below, supported by ECB patience.

Central Bank Notes:

• The Governing Council of the ECB kept the three key interest rates unchanged at its 4–5 January 2026 meeting, maintaining the main refinancing rate at 2.15%, the marginal lending facility at 2.40% and the deposit facility at 2.00%. This decision aligns with the assessment that the current stance supports medium-term price stability, as inflation edges below the 2% target while growth shows resilience amid balanced risks. Markets and commentary indicate value in holding steady, with no fixed path ahead given uncertainties in data.
• Price dynamics remain stable near target levels. Headline HICP inflation stood at 2.1% in November 2025, with projections for 1.9% in 2026 driven by base effects from energy and easing non-energy components. Services inflation persists somewhat elevated but trends toward moderation, alongside contained food pressures.
• December 2025 Eurosystem staff projections confirm headline inflation at 2.1% for 2025, declining to 1.9% in 2026 and 1.8% in 2027 before nearing 2% in 2028. Downside risks from soft producer prices and anchored expectations offset potential upsides from geopolitics or fiscal measures.
• Euro area GDP growth remains resilient at subdued levels, with Q3 2025 at 0.3% qoq and forecasts around 1.2-1.4% for 2025-2027. Surveys signal stabilization, bolstered by public investment and external demand against softer private spending.
• The labour market stays tight overall, with unemployment steady at 6.4% through October 2025, near historic lows and solid participation. Real incomes support consumption as inflation eases, with credit conditions aiding gradual household and firm expansion.
• Business sentiment reflects caution over US policy, trade tensions, and tariffs, tempered by easing supply chains and a competitive euro. Export sectors gain a modest lift, while domestic drivers like investment build momentum.
• The Governing Council will continue to make data-dependent decisions meeting by meeting, assessing inflation outlook, underlying trends, and transmission. Both hikes and cuts remain possible based on data, avoiding preset paths amid uncertainties.
• Balance sheet normalization proceeds steadily, with APP and PEPP portfolios shrinking post-reinvestment halts, at a pace deemed suitable without market strain.

​The next meeting is on 4 to 5 February 2026

Next 24 Hours Bias
Medium Bearish

The Swiss Franc (CHF)

Key news events today

No major news event

What can we expect from CHF today?

The Swiss Franc (CHF) shows stability amid global uncertainties, trading near USD/CHF 0.8010, supported by safe-haven demand linked to geopolitical tensions and US trade policies under President Trump. Recent Swiss CPI data revealed flat month-on-month inflation in December, easing pressure on the Swiss National Bank (SNB) to cut rates below 0%, where they have held steady.

Central Bank Notes:

• At its 11 December 2025 monetary policy assessment, the Swiss National Bank (SNB) is widely expected to leave the policy rate unchanged at 0%, extending the pause that began in September as the Governing Board judges that current settings are sufficient to keep inflation near, but still below, its target while avoiding an unnecessary move into negative rates.
• Recent data show that the tentative rebound in Swiss inflation has stalled, with headline CPI easing from 0.1% year‑on‑year in October to 0.0% in November and core inflation slipping to about 0.4%, reinforcing the view that underlying price pressures remain very weak and that deflation risks, while contained, have not fully disappeared.
• The SNB’s conditional inflation forecast is likely to remain close to the September projections, with inflation still seen averaging roughly 0.2% in 2025, 0.5% in 2026, and 0.7% in 2027 under an unchanged policy rate path, though the latest CPI prints argue for a slightly lower near‑term profile and keep open the option of renewed easing if activity or prices weaken further.
• The global backdrop has deteriorated further, as continuing U.S. tariff actions and softer external demand weigh on world trade, while uncertainty in key European and U.S. markets for Swiss exports persists, leaving the SNB cautious about the growth outlook despite Switzerland’s relatively resilient domestic demand.
• Business and labour-market sentiment in export‑oriented manufacturing remains subdued, with firms reporting pressure on margins from the still‑strong franc and softer foreign orders, although the broader economy is still expected to grow at around 1–1.5% in 2025 and unemployment only drifting up gradually from low levels.
• The SNB continues to stress its willingness to act if deflation risks re‑emerge, reiterating that it can ease policy through renewed rate cuts or targeted foreign‑exchange intervention if necessary, while also highlighting its commitment to transparent communication, including the publication of detailed minutes from recent assessments and ongoing dialogue with international partners on FX policy

The next meeting is on 19 March 2026.

Next 24 Hours Bias
Medium Bearish

The Pound (GBP)

Key news events today

No major news event

What can we expect from GBP today?

The GBPUSD trades steadily lower versus the Dollar around 1.3400 in quiet markets, with weekly outlooks favouring a short-term correction followed by declines amid USD resilience, BoE easing expectations, and pending UK GDP data pointing to subdued growth.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) will meet on 18 December 2025, with the current Bank Rate standing at 4.00 per cent after being held in a close 5–4 vote at the 5 November meeting. Market pricing and analyst commentary point to a high risk of a 25‑basis‑point cut to 3.75 per cent, but this remains conditional on incoming inflation and labour‑market data, so the December note should be treated as pre‑decision guidance rather than an ex‑post summary.
• The BoE is expected to leave its quantitative tightening (QT) framework broadly unchanged through year‑end, maintaining the lower reduction pace in gilt holdings that was set earlier in 2025. Official communications still characterise the existing QT path as consistent with a restrictive stance, with policymakers stressing that balance‑sheet reduction will remain gradual and sensitive to market‑liquidity conditions.
• Headline CPI inflation eased to 3.6 per cent year‑on‑year in October 2025, down from 3.8 per cent in September, helped by softer energy and goods prices, though it remains almost twice the 2 per cent target. Underlying inflation pressures, particularly in services, have continued to moderate only slowly, so the MPC’s central projection still envisages inflation moving closer to, but not yet reaching, 3 per cent over the course of 2026, contingent on further normalisation in energy and wage dynamics.
• UK economic activity remains weak heading into the December meeting, with the labour market showing further signs of slackening. The unemployment rate has risen toward just above 5 per cent on the latest three‑month figures to October, while overall regular pay growth has slowed to around the mid‑4 per cent range, reinforcing the view that domestic cost pressures are gradually easing.
• External conditions continue to cloud the outlook, with fragile global growth and fluctuating commodity prices contributing to bouts of financial‑market volatility. The MPC has highlighted that renewed global energy or food price shocks could temporarily slow the pace of disinflation, but such risks are currently judged unlikely to derail the medium‑term downward trajectory for inflation if domestic demand stays subdued.
• The balance of risks around the inflation outlook remains finely poised. Downside risks are linked to persistently weak domestic demand and rising unemployment, while upside risks come from still‑elevated inflation expectations, sticky services inflation, and the possibility that structural changes in the labour market leave less slack than conventional indicators suggest.
• Overall, the MPC’s stance going into December is restrictive but increasingly open to a gradual easing cycle, with any rate cuts expected to be measured and data‑dependent. Policymakers have reiterated that the Bank Rate will need to stay in restrictive territory until they are confident inflation is on a sustainable path back to the 2 per cent target, and they have signalled that the profile of cuts, once started, is likely to be shallow rather than rapid.
• The next meeting is on 5 February 2026.

  Next 24 Hours Bias
  Weak Bearish

The Canadian Dollar (CAD)

Key news events today

No major news event

What can we expect from CAD today?

The Canadian Dollar (CAD) shows mixed signals today amid ongoing economic pressures. Recent employment data revealed an unemployment rate climbing to 6.8%, signalling a slowing economy and contributing to the loonie’s weakness against the USD. Analysts forecast potential strengthening in 2026 due to Bank of Canada rate stability and US Fed cuts, though oil price declines and USMCA trade risks pose headwinds.
​
Central Bank Notes:

• The Governing Council left the target for the overnight rate unchanged at 2.25% at its 10 December 2025 meeting, in line with market expectations and signalling that the earlier easing cycle has likely concluded. The Bank noted that while global tariff tensions and trade uncertainty persist, the external backdrop has stabilised somewhat, reducing the need for additional insurance cuts even as world trade remains fragile.
• The Council acknowledged that uncertainty around U.S. trade policy and tariffs continues to weigh on business sentiment, but recent data show Canadian manufacturing and goods exports holding up better than anticipated. Surveys cited by the Bank suggest export order books have stopped deteriorating, with firms reporting some rebuilding of backlogs despite still‑cautious capital spending plans.
• Canada’s economy rebounded more strongly than expected in the third quarter, with real GDP expanding at an annualised pace of about 2.6% after a 1.8% contraction in Q2, largely on the back of higher crude exports and government spending. Monthly data show output rising 0.2% in September, though flash estimates point to a softer start to Q4 as some sectors give back earlier gains.
• Service sector activity has firmed, with indicators showing the services PMI back above the 50 threshold and broadening gains in business and professional services. However, consumer-facing categories remain mixed, as still‑elevated price levels and only modest real income growth keep a lid on discretionary spending even as tourism and technology‑related services expand.
• Housing markets have continued to stabilise, with national resale activity and prices edging higher through the autumn alongside the earlier decline in borrowing costs. The Bank noted that while some major urban centres are seeing renewed price pressures, tighter underwriting standards and still‑high affordability constraints are expected to cap the pace of any rebound.
• Headline CPI inflation eased to 2.2% year over year in October and is estimated to have remained near that rate in November, keeping it slightly above the 2% target but comfortably within the 1%–3% control range. Core measures have drifted lower, with CPI‑median and CPI‑trim around 3% or below, reinforcing the assessment that underlying price pressures are gradually moderating even as gasoline and some shelter components remain volatile.
• The Governing Council reiterated that the current policy rate is “about the right level” to keep inflation close to target while supporting the economy through a period of structural adjustment, and it signalled a shift away from near‑term easing expectations. While the Bank did not rule out future adjustments, officials stressed that, barring a material downside surprise to growth or inflation, further rate cuts are unlikely before 2026, and attention is now focused on the durability of the recovery and the evolution of core inflation.
• The next meeting is on 28 January 2026.

Next 24 Hours Bias
Medium Bearish

Oil

Key news events today

No major news event

What can we expect from Oil today?

Oil prices rose for a third consecutive day, driven primarily by escalating protests in Iran that raised concerns over potential supply disruptions from OPEC’s fourth-largest producer. Brent crude climbed toward $64 per barrel, building on a nearly 6% gain over the prior two days, while West Texas Intermediate hovered near $60, supported by broader geopolitical tensions, including US oversight in Venezuela and uncertainty around future production boosts there.

Next 24 Hours Bias
Medium Bearish

The post IC Markets Global – Europe Fundamental Forecast | 12 January 2026 first appeared on IC Markets | Official Blog.

IC Markets Global – Asia Fundamental Forecast | 12 January 2026

What happened in the U.S. session?

The U.S. session overnight featured Trump-driven headlines on Venezuelan oil exports, $200 billion mortgage bond buys to ease home loans, and a 10% credit card rate cap push, amplifying prior strong jobs data (4.4% unemployment) that dimmed near-term Fed cut prospects, with no fresh macro releases but anticipation for inflation gauges. These propelled records in Dow/S&P 500, surges in copper/gold/silver, homebuilder stocks, and defense names, while pressuring banks and mixing oil amid API draws.

What does it mean for the Asia Session?

Asian traders on Monday face a relatively quiet start to the week with no major scheduled economic releases in the region, allowing focus on global carryover effects from recent US jobs data anticipation, China’s mixed inflation readings, and President Trump’s tariff policies. Recent Asian market sessions showed mixed performances, with Japan’s Nikkei up 1.15%, Shanghai Composite gaining 0.30%, but Hang Seng slightly down amid defense stock rallies and mining sector slides.

The Dollar Index (DXY)

Key news events today

No major news event

What can we expect from DXY today?

The US dollar index (DXY) hovered around 99.13-99.14 early in the week of January 12, 2026, showing modest gains of about 0.20% from recent sessions amid mixed US labor data and anticipation of upcoming economic releases, though it shifted to a sideways short-term trend after a prior downtrend. Following a 9.59% decline over the past 12 months, its worst annual drop in eight years, the dollar stabilized near one-month highs, supported by resilient jobless claims and a narrowing trade deficit, while investors eyed Federal Reserve caution on rate cuts and potential tariff rulings

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 of 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

No major news event

What can we expect from Gold today?

Gold (XAUUSD) prices are showing consolidation around the $4,441–$4,509 range early on Monday, following a weekend non-trading period, with analysts noting mixed technical signals amid upcoming US inflation data and Fed comments. Recent trading saw gold rise to $4,510.61 on January 9 before dipping to $4,421.22 on January 8, reflecting a monthly gain of over 5–6% driven by safe-haven demand from geopolitical tensions and ETF inflows.

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 began 2026 on a strong footing, appreciating to near 0.669 amid optimism over potential RBA tightening if the upcoming Q4 CPI on January 28 surprises higher, reinforced by December minutes signaling readiness to hike and robust manufacturing data. A broadly softer USD, pressured by U.S. economic indicators like expected weak Nonfarm Payrolls and Trump-era Fed independence worries.

​
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 (NZD) shows a bearish trend against the US Dollar as it trades near 0.5720-0.5750 levels amid ongoing downward pressure from sellers and weakened risk sentiment. Recent forecasts indicate a potential bullish correction testing resistance around 0.5755 before resuming declines toward 0.5375, influenced by moving averages and relative strength indicators signaling further weakness.

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 Bearish

The Japanese Yen (JPY)

Key news events today

No major news event

What can we expect from JPY today?

The Japanese yen remained under pressure as USD/JPY traded near 157-158, driven by bearish outlooks from major banks predicting a slide to 160+ amid gradual BOJ tightening, wide yield gaps with the US, and fiscal worries in Japan. Despite positive household spending data, persistent weak real wages and escalating China-Japan trade frictions weighed on the currency.

Central Bank Notes:

• The Policy Board of the Bank of Japan will meet on 18–19 December with markets almost fully pricing a 25-basis-point hike, which would raise the short-term policy rate from 0.50% to around 0.75%, as the bank moves further away from its ultra-loose stance while stressing that any tightening will remain gradual and data-dependent.
• The BOJ is expected to continue guiding the uncollateralized overnight call rate in a narrow band around the new policy rate, near 0.75%, while signaling that the pace and timing of any additional hikes will depend on how past increases affect bank lending, corporate financing conditions, and overall economic activity.
• The quarterly path of JGB purchases remains on a pre-announced, gradual taper: outright purchases are being reduced by about ¥400 billion per quarter through March 2026, then by roughly ¥200 billion per quarter from April to June 2026, with the bank still aiming for JGB purchases to settle near ¥2 trillion in Q1 2027 and retaining flexibility to adjust the pace if market functioning or yield volatility deteriorate.
• Japan’s economy has softened in the near term, with Q3 2025 GDP contracting at an annualized rate of approximately 2.3%, as weaker residential investment and external demand weighed on activity. Meanwhile, business sentiment in manufacturing has recently improved to a roughly four-year high.
• Core consumer inflation (excluding fresh food) accelerated to around 3.0% year-on-year in October, up from 2.9% in September and remaining above the BOJ’s 2% target, while the “core-core” measure excluding both fresh food and energy rose to about 3.1%, underscoring persistent underlying price pressures.
• In the very near term, some input-cost pressures are easing as earlier import price surges fade, but services inflation linked to labor shortages, along with steady wage gains, continues to support broader price momentum; firms’ and households’ medium-term inflation expectations remain anchored slightly above 2%, keeping short-term inflation risks tilted to the upside.
• For the coming quarters, the BOJ assesses that real growth will likely run below potential as the economy digests tighter financial conditions and past yen depreciation. However, accommodative real rates, positive real wage growth, and improving corporate sentiment are expected to help sustain a modest recovery in private consumption and business investment.
• Over the medium term, as overseas demand stabilizes and domestic labor markets remain tight, the BOJ expects wage settlements and inflation expectations to keep core inflation on a gradual upward trajectory around or slightly above 2%, providing room for further cautious rate normalization as long as financial conditions remain supportive and the recovery is not derailed.
• The next meeting is scheduled for 22 to 23 January 2026.

Next 24 Hours Bias

Medium Bearish

Oil

Key news events today

No major news event

What can we expect from Oil today?

Oil markets exhibit cautious stability with WTI hovering near $56-$58 and Brent in the low $60s, as traders weigh the U.S. takeover of Venezuelan assets, potentially bearish for supply but tempered by execution uncertainties against OPEC+’s supply pause and expected U.S. inventory draws, amid technical support at $55 and lingering oversupply fears from robust global production.

Next 24 Hours Bias
Strong Bearish

The post IC Markets Global – Asia Fundamental Forecast | 12 January 2026 first appeared on IC Markets | Official Blog.

It’s no wonder why precious metals continue to stay so bullish. Trump is making the headlines again to start the new week and in case you missed it:

• NYT: Federal prosecutors open probe into Fed chair Powell amid renovation scrutiny
• Fed Chair Powell calls out Trump on his witch hunt, part of ongoing threats against the central bank

This just continues the episode from last year as Trump continues to take aim at the Fed independence amid his disdain for Powell. While it isn’t new, it serves as a good reminder of how the situation is playing out. And markets are clearly responding with contempt as evident by the risk selling we’re seeing to start the week now.

S&P 500 futures are down 0.6% with Nasdaq futures down 0.9% and Dow futures down 0.5% as we look towards European morning trade today.

The Fed will surely continue to do their job regardless of this investigation. However, it’s just unnecessary drama for something that shouldn’t even be an issue. Politics and central bank don’t tend to mix in well together. Just take a look at what’s happening with Japan now as another example.

But essentially, Trump’s continued attacks will just keep drawing flak and raises fears about credibility and independence at the Fed moving forward. And that is something that will keep chipping away at confidence in the central bank and the dollar in general.

For now, risk trades are taking a step back amid the unprecedented attack on Powell. And it comes at a crucial time for US stocks as well. Earnings season is kicking off this week with the big banks set to report, but also keep an eye out on TSMC earnings. The latter is a bellwether for how chipmakers might fare and so that might be the biggest name to watch this week.

Besides that, geopolitical risks are also still not completely out of the picture just yet. Trump continues to raise threats on Greenland and Iran, keeping a more nervous mood on the global stage after the situation in Venezuela.

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

• Yuan’s rally lacks fundamental support despite 2025 gains, former SAFE regulator says
• US hosts G7 talks on rare earths to counter China’s supply dominance
• UK hiring weakens again as wage growth stays firm, complicating BoE outlook
• Trump threatens to block Exxon from Venezuela after CEO calls country uninvestable
• PBOC sets USD/ CNY reference rate for today at 7.0108 (vs. estimate at 6.9849)
• Gold and silver surge, stocks & USD slammed on news of Trump’s ongoing attacks on the Fed
• Fed Chair Powell calls out Trump on his witch hunt, part of ongoing threats against Bank
• NYT: Federal prosecutors open probe into Fed chair Powell amid renovation scrutiny
• Wall Street Journal: “U.S. Steps Up Planning for Possible Action in Iran”
• Globex trade is open for the week, US equity index futures with small gap down
• EUR wobbles – France budget at risk as confidence votes threaten government collapse
• ICYMI: Japan’s PM Takaichi is considering calling a snap election for mid-February
• Monday open indicative forex prices, 12 January 2026

Weekend:

• Europe moves to boost NATO Arctic presence to counter Trump’s Greenland rhetoric/threat
• Trump orders special forces to draft Greenland invasion plan – UK Sunday Daily Mail report
• Newsquawk Week Ahead: US Earnings, US CPI, US Retail Sales, UK GDP, and China Trade
• Trump floats one-year 10% credit-card rate cap, offers zero enforcement detail, just talk

Summary:

• USD slides on Fed independence fears: Dollar fell sharply after Powell said the Justice Department issued grand jury subpoenas, reviving concerns over political pressure on the Federal Reserve.

• Markets turn defensive: Gold and silver surged, US equity futures fell, and risk sentiment weakened as institutional risk re-entered pricing.

• Senate pushback escalates: Senator Thom Tillis said he will block confirmation of any Fed nominee until the investigation into Powell is resolved, raising leadership uncertainty.

• Oil supported by Iran risks: Crude prices rose on fears protests in Iran could disrupt up to 1.9 mbpd of exports, though gains were capped by Venezuela uncertainty.

• Trump–Exxon tensions resurface: Trump said he may block Exxon from investing in Venezuela after the company’s CEO called the country “uninvestable.”

The US dollar suffered its sharpest setback in almost three weeks after Federal Reserve Chair Jerome Powell disclosed that the central bank had received grand jury subpoenas from the Justice Department. Powell characterised the move as a politically motivated attempt by the Trump administration to influence monetary policy, reviving long-standing concerns around Federal Reserve independence.

The remarks rattled markets. The Bloomberg Dollar Spot Index fell around 0.2%, US equity index futures moved lower, and strategists warned that renewed institutional risk could undermine the greenback. The dollar weakened broadly against G10 peers, though it later clawed back ground against a notably weak yen, while gold and silver surged sharply as investors sought protection from political and policy uncertainty.

Political fallout intensified when Republican Senator Thom Tillis, a senior member of the Senate Banking Committee, said he would block confirmation of any Federal Reserve nominee, including the next Fed chair, until the legal maters are resolved. Tillis said the episode removed any doubt that efforts were under way to erode Fed independence, adding that the credibility of the Justice Department itself was now at stake. Note that if a successor is not confirmed, Powell would remain in the role beyond the end of his current term.

In commodities, oil prices extended gains as rising protests in Iran stoked concerns over potential supply disruptions from the OPEC producer. Analysts noted calls for oil workers to down tools, warning that as much as 1.9 million barrels per day of Iranian exports could be at risk if unrest escalates. President Donald Trump added to the geopolitical backdrop, saying the US has “strong options” to respond to any Iranian attack with overwhelming force.

Trump said he may block Exxon Mobil from investing in the country after the company’s CEO described Venezuela as “uninvestable,” underscoring the political and legal risks that continue to complicate any rapid recovery in Venezuelan oil output.

Note the weekend news above, plenty of Arctic geopolitics!

Asia-Pac
stocks:

• Japan
  (Nikkei 225) +1.6%
• Hong
  Kong (Hang Seng) +0.86%
• Shanghai
  Composite +0.75%
• Australia
  (S&P/ASX 200) +0.41%

This is real, Trump on his ‘Truth’ app:

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

Summary:

• UK hiring fell for a 39th straight month in December

• Permanent placements declined at the fastest pace in four months

• Starting salaries rose at the strongest rate since May

• Payroll tax rises continue to weigh on recruitment

• BoE faces tension between weaker jobs data and wage pressures

Britain’s labour market showed further signs of cooling at the end of 2025, even as wage pressures remained elevated, reinforcing the policy dilemma facing the Bank of England as it weighs the timing and pace of future interest-rate cuts.

A closely watched survey from the Recruitment and Employment Confederation and KPMG showed hiring activity weakened again in December, marking the 39th consecutive monthly decline in permanent staff placements. The downturn was the steepest in four months, underscoring persistent caution among employers amid higher costs and an uncertain economic outlook.

Businesses have increasingly pointed to the payroll tax increase introduced in Chancellor Rachel Reeves’ 2024 budget as a key factor restraining recruitment. Combined with elevated borrowing costs and subdued growth, firms continue to limit headcount expansion and rely more heavily on temporary staff to retain flexibility.

Despite the slowdown in hiring, pay growth showed renewed momentum. Starting salaries for permanent roles rose at the fastest pace since May, reflecting ongoing competition for workers with in-demand skills. Even so, wage growth remained below its long-run average, suggesting some easing from the peaks seen earlier in the inflation cycle.

Survey respondents noted a modest rise in candidate availability alongside falling vacancies, a pattern consistent with a gradual loosening of labour market conditions. Temporary hiring also declined, weighed down by weak business confidence and cost concerns.

—

The BoE cut interest rates by 25 basis points to 3.75% in December, but policymakers remain divided between those focused on sticky wage-driven inflation and others warning of a more pronounced labour market slowdown.

Financial markets currently expect one or two additional quarter-point rate cuts in 2026. However, the persistence of pay growth, even as hiring weakens, complicates the outlook and suggests the BoE is likely to proceed cautiously as it assesses whether easing inflation pressures are sufficiently entrenched.

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

Summary:

• France warns 2026 budget may be delayed past March elections

• Confidence votes next week threaten government survival

• Possible National Assembly dissolution if government falls

• Budget talks already late amid deficit concerns

• Political uncertainty weighs on fiscal credibility

France budget risks delay as confidence votes threaten government stability

France’s fragile fiscal outlook is back in focus after Budget Minister Amélie de Montchalin warned that adoption of the country’s 2026 finance bill could be pushed back until after municipal elections in March if lawmakers topple the government in confidence votes expected next week.

Speaking in a televised interview on Sunday, de Montchalin said the collapse of the government would make it “impossible” to pass a budget before the local elections, underscoring the political risks hanging over France’s already-delayed fiscal process. Her comments follow remarks from another cabinet minister suggesting President Emmanuel Macron would dissolve the National Assembly and call snap legislative elections if the government loses a no-confidence vote.

France has been operating under heightened political uncertainty since Macron lost his parliamentary majority, forcing the government to rely on fragile alliances and procedural tools to advance legislation. Budget negotiations for 2026 are already running late, against a backdrop of persistent deficits, rising debt servicing costs and growing scrutiny from ratings agencies and EU fiscal authorities.

Tensions escalated on Friday after the far-right National Rally and the left-wing France Unbowed jointly called for parliamentary confidence votes tied to opposition to the EU’s Mercosur trade agreement with Latin America. While the trade deal itself is unlikely to be decisive, it has become a political flashpoint for parties seeking to weaken the government.

If the government falls, attention would quickly shift to the risk of snap elections, further delaying fiscal decision-making and complicating France’s commitments to rein in deficits under revised EU budget rules. Municipal elections in March already limit lawmakers’ appetite for tough fiscal choices, increasing the likelihood of a prolonged budget vacuum.

For markets, the renewed political instability raises concerns about France’s fiscal credibility, with implications for OAT spreads, euro sentiment and broader confidence in Europe’s ability to deliver disciplined budget policy amid slowing growth.

Snap election? Given the fractured politics in France it may not resolve anything.

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

Adam had the news on Friday:

• Japan’s Takaichi weighs calling a snap election for mid-February

More on this, summary:

• LDP lawmakers expect possible Lower House dissolution in late January

• Snap election could be held as early as February

• Takaichi citing inflation relief and economic impact as priorities

• Ruling bloc holds slim Lower House majority, Upper House minority

• Election logistics already being quietly prepared

Speculation is building within Japan’s ruling Liberal Democratic Party that Prime Minister Takaichi Sanae could dissolve the Lower House at the start of the ordinary Diet session later this month, potentially triggering a snap general election as early as February.

A growing number of LDP lawmakers believe the prime minister is inclined to seek a fresh mandate while cabinet approval ratings remain relatively strong. The ordinary Diet session is scheduled to begin on January 23, a timing that would allow an early or mid-February election if the chamber is dissolved promptly.

Asked about the possibility of dissolution, Takaichi said the government’s priority is ensuring households feel the benefits of economic policy and measures aimed at curbing rising prices. She added that the administration is continuing to work on inflation relief and broader economic support, comments widely seen as leaving the election option open.

The Takaichi administration currently holds only a slim majority in the Lower House after three independents joined the LDP bloc, while remaining in the minority in the Upper House. That fragile parliamentary arithmetic has added to expectations that the prime minister may move early rather than risk erosion of political momentum.

LDP policy chief Kobayashi Takayuki said the authority to dissolve the Lower House rests solely with the prime minister, warning lawmakers they should always be prepared “as if on a battlefield.” Similar language has been echoed across both ruling and opposition parties.

Opposition leaders have also begun positioning for an election. Constitutional Democratic Party head Noda Yoshihiko said Takaichi would face scrutiny over whether she is prioritising a political mandate over tackling inflation and economic challenges. Democratic Party for the People leader Tamaki Yuichiro said candidate preparations would be accelerated.

Coalition partner Komeito, however, has urged focus on inflation countermeasures rather than political manoeuvring.

The Internal Affairs Ministry has already instructed prefectural election boards to prepare for a possible vote. Any final decision may hinge on public opinion, upcoming diplomatic engagements with South Korea and Italy, and the impact a snap election could have on deliberations over the fiscal 2026 budget.

***

Takaichi’s objective in calling a near-term election would be to secure a stronger governing mandate. For traders and investors, the more immediate implication is the prospect of even greater fiscal support under her administration. The market read is negative for both JGBs and the yen, given Japan’s already extreme public-debt burden and rising debt-servicing costs as the Bank of Japan gradually edges rates higher.

The yen weakened last week ahead of Friday’s headlines and has extended those losses since, timing that some in the market may view with raised eyebrows (cough … insider trading … cough).

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

The PPI data listed on the calendar from Japan is not due today, its due on Wednesday 14 January 2026.

Japanese markets are closed for a holiday today.

The data from Australia is not likely to move Oz markets around much at all upon release.

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

Summary:

• UK and Germany are leading talks on boosting European and NATO military presence in Greenland.

• Germany plans to propose a NATO Arctic mission, Arctic Sentry, modelled on Baltic Sentry.

• Move aims to undercut Trump’s argument that the US must control Greenland for security.

• European concern has intensified after recent US military action in Venezuela.

• Denmark seeks diplomacy to counter what it calls exaggerated US security claims.

European powers led by the UK and Germany are discussing plans to expand their military presence in Greenland and the wider Arctic, aiming to demonstrate that Europe and NATO already have regional security under control and to blunt renewed rhetoric from Donald Trump about US ownership of the island, Bloomberg (gated) reported.

Germany is preparing to propose a joint NATO Arctic mission, informally dubbed Arctic Sentry, modelled on the alliance’s Baltic Sentry operation, according to people familiar with the discussions. The move would signal a stronger allied footprint in the High North amid rising concern over Russia and China’s Arctic ambitions.

The push follows Trump’s repeated claims that the US must control Greenland to prevent Russian or Chinese encroachment, assertions rejected by Nordic governments. European leaders are increasingly alarmed by the president’s recent rhetoric and actions, including a US raid to capture Venezuela’s leader, which has sharpened fears about Washington’s willingness to use force to achieve foreign-policy goals.

UK Prime Minister Keir Starmer has urged allies to increase their security presence in the Arctic and has held talks with French President Emmanuel Macron and German Chancellor Friedrich Merz. Starmer has also spoken directly with Trump, stressing the need to deter an increasingly aggressive Russia in the region.

Germany’s foreign minister, Johann Wadephul, is set to raise Greenland and NATO’s role in Arctic stability during talks with US Secretary of State Marco Rubio this week. Denmark, meanwhile, hopes an imminent diplomatic visit to Washington can temper tensions and correct what it says are exaggerated security claims.

While Trump has said he prefers to “make a deal” to acquire Greenland, he has not ruled out the use of force. Rubio has since told lawmakers that Washington’s aim remains a purchase rather than military intervention — an assurance closely watched by European capitals wary of strain on NATO unity.

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