Asia Market Quick Take – December 19, 2025

Key points:

• Macro: US headline inflation below forecast at 2.7% and core matches estimates
• Equities: Equities rose after weak CPI, Open AI $100b fund raising; Nike down 10.8%
• FX: USD steady amid CPI drop; EUR down after ECB rate hold
• Commodities: Gold and silver near record highs; platinum near a 17‑year high
• Fixed income: US Treasuries ended higher; foreign holdings declined

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Disclaimer: Past performance does not indicate future performance.

Macro:

• US inflation was 2.7% in December 2025, the lowest since July and below forecasts. Energy rose 4.2%, with notable food and shelter cost increases. Core inflation was 2.6%, its lowest since March 2021. CPI rose 0.2% from September to November, despite data gaps from a government shutdown.
• Japan's annual inflation rate decreased to 2.9% in November 2025 from October's 3.0%. Core inflation remained at 3.0%, matching estimates. Monthly CPI rose 0.4%, consistent with October and the highest in eight months.
• ECB kept rates unchanged for the fourth meeting. President Lagarde stated no rate changes were discussed, focusing on a flexible approach amid uncertainty. Growth is forecast at 1.4% for 2025 and 2027, with inflation at 2.1% in 2025 and slightly decreasing thereafter, adjusting upward for 2026 due to services.
• Bank of England cut the Bank Rate by 25 basis points to 3.75%, responding to easing inflation and economic strain. The vote was close, with future cuts depending on inflation trends. UK inflation dropped to 3.2% in November, below forecasts, amid GDP contraction and cooling wage growth.
• Fed's Goolsbee sees favorable inflation data but is wary of rapid rate cuts, seeking more sustained cooling of inflation. He notes the job market's steady cooling and suggests rates can drop significantly if inflation approaches 2%.

Equities: 

• US - U.S. stocks rose Thursday as inflation cooled, fueling hopes for more Fed rate cuts. The S&P 500 gained 0.8%, the Nasdaq climbed 1.4%, and the Dow added 66 points. November inflation fell to 2.7%, the lowest since July and below forecasts of 3.1%, while core inflation eased to 2.6%, its lowest since March 2021. Micron surged 10% after beating earnings and guiding strongly. DJT is up 42% after announcing a merger with fusion energy start up TAE Technologies. In after hours, Nike fell 10.8% after reporting earnings that showed weak sales in China persisting while Oracle rose 5% after it will lead a US JV to buy TikTok, owning a 15% stake in the deal.
• EU - European stocks advanced Thursday as investors digested central bank decisions. The STOXX 50 rose 0.5% and STOXX 600 gained over 1% after the ECB held rates and reiterated its data-dependent stance, with updated growth and inflation forecasts offering little reason for policy change. President Lagarde noted inflation remains in a “narrow range” near the 2% target. Norway and Sweden also kept rates steady, while the BoE cut by 25 bps as expected. ASML rebounded 2.1% after prior losses, and Inditex added over 2%, while Novo Nordisk slipped more than 1%. Focus now shifts to upcoming economic data and policy signals.
• HK - Hang Seng edged up 29 points (0.1%) to 25,498 on Thursday, reversing early losses as financials led gains. Data showed China’s youth unemployment eased to 16.9% in November, a five-month low, signaling tentative labor stabilization. Fiscal revenue grew 0.8% year-on-year in the first 11 months, while spending slowed to 1.4%. U.S. futures traded mixed ahead of key inflation data and Trump’s year-end address. Notable gainers included ZTO Express (+2.5%), Prada (+2.3%), Techtronic (+1.5%), and Henderson Land (+1.3%).

Earnings this week:

• Friday: Paychex, Carnival, Conagra, Lamb Weston

FX:

• USD held steady despite softer-than-expected CPI data impacted by government shutdown distortions. Core CPI fell to 2.6% from 3%, and headline dropped to 2.7%. DXY hit 98.17 before rebounding to 98.45.
• EUR edged down after the ECB maintained rates but hinted the easing cycle might be over, pushing EURUSD to 1.17620 before retreating.
• GBP advanced as the BoE unexpectedly leaned hawkish against calls for rate cuts, lifting GBPUSD near 1.3380, down from 1.3446 highs.
• JPY stayed flat ahead of a BoJ meeting likely to deliver a 25bps hike.
•  Scandinavian central banks kept rates unchanged with little effect on EURNOK and EURSEK.

Commodities:

• Oil is heading for a second weekly decline, with WTI near $56 and down over 2% for the week and Brent below $60, as glut concerns outweigh supply risks and major traders see oversupply into early next year—Trafigura even forecasts Brent in the $50s through mid‑2026.
• Gold and silver hovered near record highs after softer US inflation bolstered rate‑cut bets, with spot gold steady at $4,331.67 in early Asian hours up 0.7% for the week and within sight of October’s $4,381 peak—silver up 0.1% to $65.51 near Wednesday’s $66.89 record, while platinum neared a 17‑year high and palladium climbed.

Fixed income:

• US Treasuries ended higher after headline and core November CPI missed estimates, with a pre‑auction concession helping the 5‑year TIPS sale stop through the when‑issued and options demand re‑emerging for protection around 4% on the 10‑year; foreign holdings fell $5.8bn in October to $9.24tn as China cut $11.8bn to $688.7bn (lowest since 2008) while Japan and the UK increased, and Japan’s 10‑year futures rose a tick to 133.35 ahead of a BoJ hike to a three‑decade high.

For a global look at markets – go to Inspiration.

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