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If you’ve been watching the Canadian curve steepen with bets on Bank of Canada hikes, CIBC has a message for you: Not so fast.

Following the November CPI release earlier today, CIBC’s Andrew Grantham is out with a note pouring cold water on the recent hawkish repricing in the market. While headline inflation held steady at 2.2%, Grantham argues the details don’t support the aggressive pricing for hikes we’ve seen creeping into the strip before the end of 2026.

The “Push and Pull” keeps the Bank on hold

Grantham describes the current environment as a “push and pull” dynamic. You have the “push” of stronger food and gasoline prices—grocery costs just saw their biggest monthly jump since March —being offset by the “pull” of softer core inflation.

That leaves the Bank of Canada in a bind, but a stable one.

Key takeaways from CIBC:

• The Sweet Spot (sort of): Underlying inflation is sitting around 2.5%. That is still “too high” to justify any further interest rate cuts right now.

• The Pushback: However, the data isn’t hot enough to validate the market’s recent pricing for rate hikes. Pricing is currently at 12% for a hike in September or sooner with one hike at 92% by year end.

• Volatility Ahead: Don’t get chopped up by headline volatility in the coming months. Grantham warns that base effects from last year’s GST/HST holiday will make the headline numbers noisy, even as core measures (excluding tax changes) likely continue to ease.

The bottom line from CIBC is that the Bank of Canada is locked into a “prolonged pause”. That’s likely to make the Fed side of the equation more meaningful for USD/CAD.

They continue to forecast the overnight rate holding steady at the current 2.25% level throughout the entirety of next year. Bond yields and the Loonie drifted marginally lower on the print, suggesting traders are already starting to unwind some of those hike bets.

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

Gold has been an incredible ride this year, up 64% year-to-date. Silver has nearly doubled that return and gold equities are up a massive 130%. Naturally, after a run like that, the “take profit” crowd is starting to get loud.

However, Scotiabank released a note this morning titled “Here’s Why We Don’t Give Up on the Gold Trade,” arguing that they remain Overweight on the sector and see further upside ahead.

Their main argument? The “broad and synchronized” tailwinds that fueled this rally are unlikely to reverse next year.

Here are the 6 catalysts Scotiabank is watching:

1. The Debt Spiral: This is the big one. US debt now stands at $37.6 trillion, up 65% in just five years. With no plan to return to fiscal equilibrium, government debt is expected to keep rising.

2. Crypto Demand (Yes, really): A new whale has entered the chat. Stablecoins backed by physical gold are driving demand, with reports estimating Tether has already hoarded over 120 tons of gold to back its token.

3. Fed Independence Risks: Markets are jittery about the Fed. If Trump appoints a dovish Chair, it could erode confidence in US institutions and intensify selling pressure on the dollar—a classic setup for gold.

4. Trade Wars 2.0: With USMCA up for renewal next year and China negotiations continuing, elevated trade uncertainty is keeping the safe-haven bid alive.

5. Weaker Dollar: Scotiabank remains bearish on the USD overall, viewing further declines as a direct boost for metals.

“But isn’t it overextended?”

It feels like it, but historically? Maybe not.

6) Scotiabank notes that while the recent run is amazing, it’s not unprecedented. They point to the late 1970s, where gold prices rose more than 6-fold and silver rose 9-fold. By that metric, this bull market might just be getting started.

From a valuation perspective, gold equities are actually trading cheaper than previous peaks. The sector is currently at ~7x EV/Fwd EBITDA, compared to valuations of over 10x observed back in 2010/2011.

The Play:

Scotiabank notes that many investors are actually still Underweight because they feel uncomfortable chasing a 60% rally. If you’re looking for equity exposure, their top picks (all rated Sector Outperform) are Kinross Gold (KGC), OceanaGold (OGC), and DPM Metals (DPM)

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

The candidacy of Kevin Hasset ” has received some pushback by high-level people who have the ear of
President Donald Trump,” according to CNBC citing sources familiar.

The concern is that he’s too close to the President.

Those people better be careful what they wish for because Kevin Warsh comes with his own set of concerns.

My guess is that people who are pushing for Waller are behind this, as he’s the only realistic candidate with any credibility. However on Friday, Trump said:

“I think the two Kevins are great”

That indicates it’s a two-horse race. Over at Kashi, Warsh has passed Hassett:

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

• Prior was 38
• Current single-family home sales 42 vs 41 prior
• Prospective buyers 26 vs 26 prior

The market is getting a sense of where Fed rates will bottom and it looks like US 30-year yields will finish the year where they started. In short, there is no help coming for the US housing market.

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

The US dollar is down on most fronts this year but it came after years of gains. The team at Scotiabank says don’t get too comfortable with USD longs as the worst is yet to come.

In their Focus On 2026 outlook, Scotia’s Shaun Osborne and Eric Theoret are sticking to their guns: they see broad USD weakness playing out through 2026 and into 2027.

The core thesis here is simple: Divergence.

Scotia expects the Fed to cut rates significantly—taking the target rate down to 3% by the first half of 2026. Meanwhile, other major central banks are expected to make few policy changes or even tighten.

It’s the classic rate differential trade and erodes the two pillars that have held the dollar up for so long: higher relative growth and those juicy yield differentials. We’ve been hearing about the “end of US exceptionalism” for a while, but Scotia thinks the real pain point for the USD hits in Q2/Q3 of 2026 as the US labour market slows down and the Fed stays dovish.

The Euro and Yen: The quiet climbers

For the euro, the ECB is expected to leave rates unchanged, which should boost EUR/USD higher. Scotia is targeting a medium-term move into the 1.22-1.24 range (spot at 1.17).

For the yen, with the BoJ expected to tighten modestly in 2026, the currency finally gets some love. The forecast sends USDJPY down to 140 by late 2026 and 130 by the end of 2027. (spot at 155.68)

The Contrarian Trade: Buy the Loonie

If you’re looking for a non-consensus trade, this is it. The market is overwhelmingly short CAD right now, but Scotia sees a massive reversal incoming.

While the Fed is cutting to 3%, Scotia expects the Bank of Canada to actually start hiking rates in the second half of 2026.

They see the spread between the Fed and the BoC—which is currently a massive 175 bps—collapsing to just 25 bps by the end of next year. As that compression happens, their forecast puts USDCAD to 1.35 by year-end 2026, dropping to 1.30 by 2027. (spot at 1.3775)

Emerging Markets: Caution on the Peso

For the carry traders, the outlook on the Mexican Peso (MXN) is a lot less rosy. Scotiabank is bearish here despite the yield.

Why? Banxico is cutting rates just as volatility is picking up. The narrowing spread with the US, combined with trade uncertainty around the CUSMA review, makes the risk-reward look poor. They see USDMXN grinding higher to 19.00 next year and 20.40 by 2027.

Scotiabank FX Forecasts at a Glance

Here are the key levels they are watching for the majors by December 2026:

• EURUSD: 1.21
• USDCAD: 1.35
• USDJPY: 140
• GBPUSD: 1.38
• USDMXN: 19.00

If Scotia is right, the “higher for longer” US yields trade is dead, and the rotation out of the dollar is the big macro play for 2026.

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

• Prior was 2.2%
• Inflation m/m +0.1% vs +0.1% prior
• BOC core 2.9% vs 2.9% prior
• BOC core m/m -0.1% vs +0.6% prior
• Core CPI +0.2% m/m vs +0.3% prior
• CPI median +2.8% vs +2.9% expected
• CPI trim +2.8% vs +2.9% expected
• CPI common 2.8% vs 2.7% prior
• Ex gasoline +2.6% vs +2.6% prior

This is generally good news for the Bank of Canada as the monthly numbers were benign.

Lower prices for travel tours and traveller accommodation, in addition
to slower growth for rent prices, put downward pressure on the all-items
CPI, Statistics Canada said. Offsetting the slower growth in services on an annual basis were higher
prices for goods, driven by price increases for groceries as well as a
smaller decline for gasoline prices.

For Canadians, the 4.7% y/y rise in grocery prices (up from +3.4%) will bite hard and is the highest y/y rise since Dec 2023. Fresh fruit was a strong component of the increase but the headline rises were in frozen been (+17.7%) and coffee (+27.8%).

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

• Prior was +18.7

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

• Prior month 18.7
• Current month (December) -3.90
• Estimate 10.0
• new orders 0.0 versus 15.9 last month.
• Shipments -5.7 versus 60.8 last month.
• Employment 7.3 versus 6.6 last month.
• Average employee workweek 3.5 versus 7.7 last month
• Prices paid 37.6 versus 49.0 last month.
• Prices received 19.8 versus 24.0 last month.

NY Fed Empire State Manufacturing Index – December Overview

• Business activity declined slightly in December, following two months of expansion.

• Headline general business conditions index fell to -3.9, down sharply from last month’s high, turning negative again.

New orders and shipments:

• New orders were steady, with roughly one-third of firms reporting increases and about one-third reporting declines.

• Shipments declined modestly, reflecting softer near-term demand.

Supply chain and inventories

• Delivery times shortened, indicating easing supply chain pressures.

• Supply availability worsened, suggesting renewed input constraints.

• Inventories increased modestly, pointing to stockpiling amid uncertainty.

Employment and hours worked

• Employment increased modestly, with the employment index rising to 7.3, its sixth positive reading in seven months.

• Average workweek edged lower, signaling only limited labor demand momentum.

Inflation and pricing pressures

• Input price increases slowed for a second straight month, but remain elevated.

• Prices paid index fell to 37.6, the lowest level since January.

• Prices received also declined, easing margin pressures slightly but staying historically high.

Capital spending and investment

• Capital spending plans increased, with the capex index rising to 6.9, signaling modest investment growth.

Outlook and business sentiment

• Firms became increasingly optimistic about the next six months.

• Future business conditions index rose to its highest level since January.

• Expectations for future new orders and shipments improved sharply.

• Firms expect price pressures to remain elevated, while inventories are forecast to expand further.

Bottom line

• Current activity softened, but forward-looking optimism strengthened.

• Inflation pressures are easing but not resolved, while employment and investment remain supportive of a gradual manufacturing recovery.

If you want, I can:

• Condense this into a one-screen summary, or

• Add a market impact section (USD, rates, equities).

This article was written by Greg Michalowski at investinglive.com.

• EURUSD Technical Analysis: ECB to hold rates steady, traders focus on US NFP and CPI
• GBPUSD Technical Analysis: Focus on key UK and US data this week for the next direction
• Dubai Will Host Its First-Ever Trading Festival alongside iFX EXPO
• Market outlook for the week of 15th-19th December
• USD/CAD keeps on falling on divergent market pricing: focus on Canada CPI and US NFP now
• Gold approaches record highs ahead of key US data: here’s how it’s likely to react
• Yen takes the lead as USD/JPY drops to 155.00 ahead of key US data. What’s next?
• FX option expiries for 15 December 10am New York cut
• S&P 500 Trade Idea for Prop Traders Today
• What are the main events for today?

It’s been kind of a synthetic Sunday in the European session with no data releases and very limited newsflow. The most notable mover has been the Japanese Yen.

The currency appreciated on the back of better than expected Tankan data and some constructive BoJ commentary overnight. The rate hike odds increased to 83%.

The market is now sure that the BoJ is going to deliver a 25 bps rate hike at this week’s monetary policy decision but it’s not expecting the central bank to outhawk the current pricing, which sees the BoJ tightening by 67 bps by the end of next year. The JPY will likely be driven more by the US data than the BoJ decision, unless the central bank decides to surprise the market.

The US dollar, meanwhile, remains weak pretty much across the board after Fed Chair Powell sounded more dovish in his press conference. Still, we have key US data this week that could change the short-term trend, starting tomorrow with the US NFP report.

In the American session, the main highlight will be the Canadian CPI report. The most important data to watch will be the underlying inflation measure, that is the Trimmed Mean CPI Y/Y, which is expected at 2.9% vs 3.0% prior.

The BoC last week held interest rates steady but didn’t validate the market’s rate hike bets just yet. In fact, the central bank kept a cautious tone and highlighted the weak details in the recent GDP and employment reports despite acknowledging the improvements. The market is still fully pricing a rate hike by the end of 2026.

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

US Stocks Lose Ground into the Weekend – Nasdaq Down 1.7%

US equity markets moved lower on Friday as investors grew increasingly cautious around stretched valuations in the technology sector, while comments from Federal Reserve officials reinforced concerns that inflation pressures may persist. The Dow Jones fell 0.50% to close at 48,458, while broader losses were seen in the S&P 500, which dropped 1.07% to 6,827. The Nasdaq underperformed, sliding 1.69% to finish at 23,195. The US dollar was little changed on the session, with the DXY edging just 0.05% higher to 98.39. Treasury yields were mixed, with the 2-year yield easing by 1.8 basis points to 3.522%, while the 10-year yield rose 2.7 basis points to 4.184%. Oil prices drifted modestly lower as oversupply concerns heading into the new year continued to weigh on sentiment. Brent slipped 0.26% to $61.12 a barrel, while WTI fell 0.28% to $57.44. In contrast, gold pushed higher, gaining 0.45% to $4,299.63, reaching its highest level in nearly two months as investors sought defensive exposure.

Non-Farms on a Tuesday to Move Markets

It is a huge day for financial markets on Tuesday, with delayed US employment numbers due out that will include data from both October and November. The impact of the US government’s largest-ever shutdown is still reverberating around financial markets, and tomorrow’s Non-Farms data being released on a Tuesday is another strange update for seasoned campaigners who are used to the usual Friday release. Estimates are varied across the market due to the data blackout in October and November, and therefore traders are expecting plenty of volatility around the event. The variation in estimates is fairly wide for the headline figure, but a range of +50k to +80k seems to cover most of the market, and any significant deviation will see strong moves across all financial products.

Quiet Start to a Busy Calendar Week

It is a quiet start to the week on the macroeconomic calendar, although traders are positioning ahead of a very busy period of central bank meetings and key economic data releases over the coming days, which are expected to drive volatility across markets. There is a big data dump due out of China during the Asian session today, with the highlights being Industrial Production (exp +5.0% y/y) and Retail Sales (exp +3.0% y/y), which could move local markets. There is little scheduled in the London session; however, key inflation data due out of Canada should see some volatility in the loonie. The monthly CPI number is expected to show a 0.1% increase, with the median year-on-year data expected to print at +2.9%. The US Empire State Manufacturing Index data is due out at the same time, with a +9.8 figure priced into the market. We also hear from Fed members Miran and Williams later in the day.

The post General Market Analysis – 15/12/25 first appeared on IC Markets | Official Blog.

It was a busy week for financial markets last week, and it promises to be another one in the days ahead. There was a big central bank focus last week, with the RBA, the Bank of Canada, and the Swiss National Bank all holding rates steady, while we got the highly anticipated rate cut from the Federal Reserve.

The central bank focus continues this week, with key calls due from the Bank of England, the European Central Bank, and the Bank of Japan. In addition to the central bank action, there are some crucial data updates due out on the calendar as well, including a shutdown-delayed Non-Farm Payrolls and Retail Sales data run, and key inflation numbers from the US, UK, and Canada.

Traders are expecting this week to be the storm before the calm of Christmas week, and so plenty of volatility looks to be on the cards, with many products potentially at very different levels by 5pm NY time next Friday.

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

It is a relatively quiet start to a busy week on Monday, with little on the calendar for the first two sessions of the day. The New York session sees the first top-tier data release of the week in the form of the Canadian CPI data; this comes out alongside the Empire State Manufacturing Index numbers. We are also due to hear from Fed members Williams and Miran during the afternoon.

It is a huge day on the calendar on Tuesday. There is a raft of flash services and manufacturing PMI data out across several jurisdictions, but the big moves will likely come from employment data releases, with key numbers due out from the UK and the US. The US session not only sees the Non-Farm Payrolls release—11 days late, as the BLS continues to play catch-up after the shutdown—but also delayed Retail Sales numbers, and traders are expecting a very busy day around the data.

Again, the Asian session has little on the calendar on Wednesday; however, the focus will be on UK markets as Europe comes in with the latest CPI data due out. Attention then jumps across the Channel for the German IFO Business Climate data. The New York session is quiet in terms of data releases, with just the weekly crude oil inventory numbers out; however, we do hear more Fed updates, with members Waller, Williams, and Bostic speaking.

It is another massive calendar day on Thursday, and things kick off early with New Zealand GDP data out early in the Asian session. The London session is dominated by central bank action, with both the Bank of England and the European Central Bank set to make interest rate decisions, and the New York session sees the release of key US CPI data, the weekly unemployment claims numbers, and the Philly Fed Manufacturing Index figures.

It is a busy final trading day of the week on Friday, with the major focus on Japanese markets during the Asian session as the Bank of Japan announces its latest rate call. UK markets are again in focus on the London open, with Retail Sales data due out. The New York session sees the initial focus north of the border for Canadian Retail Sales numbers, before US Existing Home Sales data is released alongside the University of Michigan revised consumer sentiment and inflation expectations updates.

The post The Week Ahead – Week Commencing 15 December 2025 first appeared on IC Markets | Official Blog.

IC Markets Global – Europe Fundamental Forecast | 15 December 2025

What happened in the Asia session?
During today’s Asia session, sentiment was dominated by a combination of global tech weakness and local macro themes: a strong Japanese Tankan survey kept speculation alive that the BOJ may soon hike rates, while traders positioned cautiously ahead of key Chinese November data expected to highlight weak domestic demand despite resilient industrial output. This backdrop, together with lingering fears over an AI‑driven valuation bubble and recent Wall Street tech losses, pushed major Asian equity indices lower, particularly the Kospi, Hang Seng futures, Australian ASX 200, and Japan’s benchmarks, while the yen, yuan, and AUD were the main FX crosses in focus, and Bitcoin extended its slide as risk appetite stayed muted.

What does it mean for the Europe & US sessions?
Today opens a busy macro week: traders should focus on Eurozone industrial production, Swiss SECO forecasts, and Canadian CPI as early tests of growth and inflation momentum, while positioning in EUR, CAD and CHF and in European and US indices will be shaped by how these releases feed into expectations for next steps from the ECB, BoE, BoJ and the Federal Reserve.

The Dollar Index (DXY)

Key news events today

Empire State Manufacturing Index (1:30 pm GMT)

What can we expect from DXY today?

The dollar starts Monday, on the back foot but not in free‑fall, trading just under the 99 DXY level after recent declines as investors wait for US retail sales and PMI releases that will refine expectations for the pace of future Fed easing. Technical breaks below prior support and weekly bearish candles point to a medium‑term softening trend, while macro forecasts and the cumulative effect of three Fed cuts suggest further, though measured, dollar weakness into 2026. Traders are therefore treating intraday bounces as largely corrective within a broader sideways‑to‑lower profile rather than the start of a new bullish phase for the greenback.

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

Empire State Manufacturing Index (1:30 pm GMT)

What can we expect from Gold today?

Gold starts Monday, trading near the upper end of its recent range around 4,250–4,300 USD/oz, consolidating just below record highs after a powerful year‑long rally driven by Fed rate cuts, lower real yields, and a weaker dollar. Market commentary for the week ahead points to an intact bullish structure with support in the low‑4,100s and potential for renewed upside if dips attract buyers, but also notes overbought conditions, heavy speculative positioning, and the risk of sharp corrections should profit‑taking accelerate or the dollar rebound.​

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 starts Monday on a firm footing, with EUR/USD trading around 1.17 near a two‑month high as traders respond to a softer US dollar following the Fed’s recent rate cut and to relatively hawkish messaging from the ECB. Technical structures and current positioning still lean modestly bullish for the euro, but with the pair pressing into a significant resistance band, markets expect choppy, headline‑driven trading as investors reassess interest‑rate paths on both sides of the Atlantic over the coming days.

Central Bank Notes:

• The Governing Council of the ECB kept the three key interest rates unchanged at its 30 October 2025 meeting. The main refinancing rate remains at 2.15%, the marginal lending facility at 2.40%, and the deposit facility at 2.00%. This decision reflects policymakers’ assessment that the current monetary stance remains consistent with medium-term price stability, while incoming data confirm a gradual return of inflation towards the target.
• Recent indicators point to stable price dynamics. Headline inflation remains near the 2% mark, with energy prices contained and food inflation easing slightly after earlier supply bottlenecks. Wage growth continues to moderate, contributing to the slowdown in domestic cost pressures. The ECB reiterated its commitment to a data-driven, meeting-by-meeting approach and emphasized flexibility amid uncertain global financial conditions.
• Eurosystem staff projections have not been materially altered since September. Headline inflation averages remain at 2.0% for 2025, 1.8% for 2026, and 2.0% for 2027. Recent softening in producer prices and subdued pipeline pressures suggest limited upside risks to inflation, though geopolitical tensions and potential commodity shocks continue to pose uncertainties to the outlook.
• Euro area GDP growth remains on track with earlier forecasts, projected at 1.1% for 2025, 1.1% for 2026, and 1.4% for 2027. Forward-looking indicators, including PMIs and industrial sentiment surveys, signal some stabilization in activity following weakness in the third quarter. Public investment and recovering export activity are expected to offset softer private sector demand in the near term.
• The labor market remains resilient, with unemployment rates at multi-decade lows and participation rates strong. Real income growth continues to support household spending, even as consumption growth normalizes from earlier highs. Financing conditions remain favorable, supported by stable banking-sector liquidity and improved credit demand among small and medium-sized firms.
• Business sentiment remains mixed, reflecting lingering uncertainty over global trade policy and the path of US tariffs. However, easing supply chain costs and improved export competitiveness due to softer exchange rates are providing some relief to manufacturing and external-oriented sectors.
• The Governing Council reaffirmed that future decisions will depend on an integrated assessment of incoming data—covering inflation trends, financial conditions, and the state of policy transmission. The Council emphasized that no pre-set path for rates exists; keeping all options open should the economic outlook shift markedly.
• Balance sheet reduction continues smoothly, with holdings under the APP and PEPP declining as reinvestments have ceased. The ECB confirmed that the pace of portfolio runoff remains in line with its previously communicated normalization plan, supporting a gradual withdrawal of monetary accommodation in a predictable manner.
• The next meeting is on 17 to 18 December 2025

Next 24 Hours Bias
Medium Bullish

The Swiss Franc (CHF)

Key news events today

No major news event

What can we expect from CHF today?

The Swiss franc starts Monday on a firm footing, trading near multi‑year highs versus the dollar as markets digest an SNB that has stayed on hold at 0% but sounded marginally more optimistic thanks to lower US tariffs and resilient global demand, while a freshly eased Fed keeps downward pressure on the greenback. Recent data showing zero inflation and a small Q3 contraction mean Swiss policymakers still see risks from an overly strong currency, yet safe‑haven flows and improved trade prospects continue to underpin CHF, leaving it slightly softer on the month but significantly stronger year‑on‑year against major peers

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 labor‑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 Bullish

The Pound (GBP)

Key news events today

No major news event

What can we expect from GBP today?

On Monday, the Pound is slightly weaker, with GBP/USD drifting down to the mid‑1.33s as traders trim exposure before crucial UK inflation figures and Thursday’s Bank of England meeting. Recent soft GDP and moderating inflation have increased expectations of a 25 bps BoE rate cut, weighing on Sterling and prompting some “sell‑on‑rally” strategies despite the currency’s still‑solid performance over the past month.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) met on 6 November 2025 and voted 7–2 to keep the Bank Rate unchanged at 4.00 percent for a second consecutive meeting. The decision reflects the Committee’s cautious approach as inflation remains above target, but underlying economic momentum continues to weaken. Two members maintained their votes for a 25-basis-point cut, citing further signs of labor-market softening and weak business sentiment.
• The BOE adjusted its guidance on quantitative tightening (QT), maintaining the reduced pace established in September. The planned reduction of UK government bond holdings remains at £67.5 billion over the next 12 months, leaving the current gilt balance near £550 billion. Policymakers described the recalibrated QT path as “appropriate for current market conditions,” emphasizing the importance of liquidity management amid heightened volatility.
• Headline inflation moderated slightly to 3.6 percent in October from 3.8 percent previously, driven by easing food and transport prices. However, core inflation has shown only gradual progress, holding near 3.9 percent. The MPC noted that services inflation and administered energy costs continue to exert pressure, highlighting the challenge of achieving the 2 percent target sustainably. The Committee’s latest projections see inflation falling toward 3 percent by mid-2026, with further downside expected if energy and wage dynamics continue to normalize.
• Economic activity remains subdued. Estimates place Q3 GDP growth close to zero, with both business output and consumer spending restrained. The unemployment rate has edged up to 4.8 percent, while pay growth cooled to just under 5 percent year-on-year. MPC members acknowledged that pay settlements are weakening further, signaling an easing in labor cost pressures as demand softens. Surveys from the manufacturing and services sectors suggest muted hiring intentions through year-end.
• International factors continue to complicate the policy outlook. Fluctuating oil prices—partly linked to renewed Middle East tensions—alongside fragile global demand have contributed to higher market volatility. The MPC reiterated that external shocks, including global food and energy disruptions, could temporarily slow the disinflation path but remain unlikely to derail the medium-term moderation in prices.
• The Committee assessed risks around inflation as balanced. Downside risks arise from sluggish domestic growth and declining real income momentum, while upside risks remain tied to elevated inflation expectations and stubborn services inflation. Policymakers emphasized the need for patience, maintaining that any rate cuts ahead of clear inflation progress could undermine confidence in policy credibility.
• The MPC’s overall stance remains restrictive but increasingly balanced, with future moves expected to follow a cautious, data-driven trajectory. The Committee reaffirmed that monetary policy will stay tight until there is compelling evidence that inflation is returning to the 2 percent target on a durable basis.
• The next meeting is on 18 December 2025.

  Next 24 Hours Bias
  Medium Bullish

The Canadian Dollar (CAD)

Key news events today

CPI m/m (1:30 pm GMT)

Median CPI y/y (1:30 pm GMT)

Trimmed CPI y/y (1:30 pm GMT)

Common CPI y/y (1:30 pm GMT)

What can we expect from CAD today?

Going into Monday the Canadian dollar is trading near its strongest levels in roughly three months as USD/CAD hovers around the mid‑1.37s, underpinned by a perception that the Bank of Canada is effectively “done cutting” after holding rates at 2.25% last week and by expectations that today’s CPI, housing, and manufacturing data will show inflation still near target but growth only mildly softer. Markets are positioned for modest further CAD strength if inflation surprises higher or proves sticky.

Central Bank Notes:

• The Council noted that U.S. tariff tensions have eased slightly following early progress in bilateral discussions, though the external trade environment remains fragile. Businesses continue to hold back on long-term investment, with the Bank highlighting that sustained clarity on U.S. trade policy is needed to restore confidence.
• The Bank acknowledged that uncertainty persists despite the softer U.S. tone, as incoming data show limited improvement in export orders. The manufacturing sector has stabilized but remains below pre-2024 output levels, reflecting weak global demand and cautious corporate spending.
• Canada’s economy showed tentative signs of recovery in early Q4, with GDP estimated to expand by 0.3% in October after two quarters of contraction. Mining and energy activity strengthened modestly, aided by steady crude demand, while goods exports posted a fractional gain.
• Service sector growth remained uneven, supported mainly by tourism-related and technology services. However, retail spending and household consumption were subdued, constrained by slower job creation and lingering consumer caution. The Bank judged overall momentum as fragile but improving marginally.
• Housing activity showed modest reacceleration in major urban markets as mortgage rates stabilized near record lows. Nonetheless, affordability pressures and stricter lending standards continue to limit overall resale volumes, resulting in only a gradual recovery in the housing sector.
• Headline CPI inflation rose to 2.1% in October, reaching the Bank’s target for the first time in six months. Higher energy prices and a modest uptick in food and shelter costs drove the increase. Core inflation measures remained stable, suggesting underlying price pressures are contained.
• The Governing Council reiterated its data-dependent stance, indicating that the current policy rate remains appropriate amid tentative growth and balanced inflation risks. Officials noted that while additional stimulus is not ruled out, the emphasis has shifted toward monitoring the sustainability of the recovery rather than immediate rate adjustments.
• The next meeting is on 17 to 18 December 2025.

Next 24 Hours Bias
Medium Bullish

Oil

Key news events today

No major news event

What can we expect from Oil today?

On Monday, 15 December 2025, oil staged only a mild bounce, with Brent around the low 60s and WTI in the high 50s, after both benchmarks slid more than 4% last week and now trade near two‑month lows. The key narrative is that expectations of a sizable global surplus and high inventories outweigh fresh geopolitical worries, including U.S.–Venezuela tensions, so rallies are being sold and sentiment remains broadly bearish even as traders trim some short positions today.​

Next 24 Hours Bias
Medium Bearish

The post IC Markets Global – Europe Fundamental Forecast | 15 December 2025 first appeared on IC Markets | Official Blog.