Weekly Market Review: December 8–12, 2025
This week, financial markets exhibited cautious optimism as central bank decisions and mixed economic data shaped investor sentiment. The U.S. Federal Reserve delivered an anticipated 25-basis-point rate cut, fueling hopes for a soft landing, while global equities edged higher on improving risk appetite. Meanwhile, the U.S. dollar softened post-Fed, commodities gained on supply concerns, and cryptocurrencies rebounded from early-week losses.
Despite the constructive tone, traders remained cautious amid thin holiday liquidity and year-end flows. Here’s a detailed breakdown of the week’s notable economic events and their impact across global markets.
Key Takeaways:
- Federal Reserve cuts rates by 25 basis points, boosting hopes for a soft landing and driving gains in global equities.
- The U.S. dollar softened post-Fed decision, while commodities rose due to supply concerns and geopolitical factors.
- China’s export growth exceeded expectations, lifting emerging market sentiment and bolstering regional equities.
- Australia’s stronger-than-expected employment data supported the Australian dollar late in the week.
- Cryptocurrencies rebounded as risk appetite improved following the Fed’s dovish stance.
| Date | Event | Currency | Actual | Forecast | Previous | Market Impact |
|---|---|---|---|---|---|---|
| Dec 8 | GDP (QoQ) (Q3) | JPY | -0.2% | -0.4% | 0.1% | Milder contraction than feared stabilized JPY; USD/JPY rose modestly early week. |
| Dec 8 | Exports (YoY) (Nov) | CNY | 5.2% | 4.5% | 4.1% | Beat supported EM optimism and commodity demand. |
| Dec 9 | RBA Interest Rate Decision | AUD | 3.60% | 3.60% | 3.60% | Expected hold; AUD/USD slipped later on softer jobs data. |
| Dec 9 | JOLTS Job Openings (Oct) | USD | 7.400M | 7.450M | 7.658M | Softening labor data fueled Fed cut bets, aiding equities. |
| Dec 10 | CPI (YoY) (Nov) | CNY | 0.4% | 0.5% | 0.2% | Slight miss but eased deflation worries; Hang Seng +0.6% WoW. |
| Dec 10 | BoC Interest Rate Decision | CAD | 2.25% | 2.25% | 2.25% | Hold kept CAD steady; USD/CAD flat (-0.02% WoW). |
| Dec 10 | Fed Interest Rate Decision | USD | 3.75% | 3.75% | 4.00% | 25bps cut as expected (92% odds); risk assets rallied, but steady 2026 dots capped USD downside. |
| Dec 11 | Employment Change (Nov) | AUD | +17.6K | 15.0K | 41.1K | Beat bolstered AUD; unemployment at 4.2% (vs 4.3% f/c) added support. |
| Dec 11 | SNB Interest Rate Decision (Q4) | CHF | 0.00% | 0.00% | 0.00% | Hold amid tame inflation; CHF eased, USD/CHF -0.42% WoW. |
| Dec 12 | German CPI (YoY) (Nov) | EUR | 2.4% | 2.3% | 2.3% | Slight beat aided EUR; EUR/USD +0.38% WoW. |
| Dec 12 | U.S. Baker Hughes Total Rig Count | USD | 587 | – | 600 | Modest drop signaled supply caution, lifting oil prices. |
Key Economic Events and Impacts
The week was packed with high-impact data releases and monetary policy decisions that stirred market activity across asset classes. Below is a summary of the most significant events, along with their outcomes and implications.
December 8: Japan’s GDP and China’s Export Data
Japan released its Q3 GDP figures, showing a 0.2% contraction quarter-over-quarter. While the decline was milder than the forecasted -0.4%, it marked a reversal from the previous quarter’s 0.1% growth. The Japanese yen (JPY) saw limited movement, with USD/JPY rising slightly early in the week as markets anticipated further Bank of Japan policy adjustments.
On the same day, China reported a 5.2% year-over-year increase in exports for November, beating expectations of 4.5% and exceeding October’s growth of 4.1%. This positive data bolstered emerging market sentiment and supported demand for commodities, providing a lift to regional equities.
December 9: RBA Holds Rates Steady; U.S. Labor Market Data Softens
The Reserve Bank of Australia (RBA) kept its benchmark interest rate unchanged at 3.60%, as widely expected. However, softer domestic labor market data weighed on the Australian dollar (AUD), causing AUD/USD to slip during the session.
In the U.S., October’s Job Openings and Labor Turnover Survey (JOLTS) revealed a decline in job openings to 7.4 million, down from September’s 7.658 million and below the forecasted 7.45 million. The softening labor data reinforced expectations of further monetary easing by the Federal Reserve, aiding equity markets as investors priced in lower borrowing costs.
December 10: China CPI Misses; BoC Holds Rates; Fed Cuts by 25 bps
China’s Consumer Price Index (CPI) for November came in at 0.4% year-over-year, slightly below the expected 0.5% but above October’s 0.2%. While the miss dampened sentiment briefly, it alleviated concerns about deflationary pressures in the world’s second-largest economy. Hong Kong’s Hang Seng Index closed the week up 0.6%.
The Bank of Canada (BoC) also opted to hold its benchmark interest rate steady at 2.25%, as anticipated. The Canadian dollar (CAD) remained stable against the U.S. dollar, with USD/CAD ending the week nearly flat (-0.02%).
The highlight of the week was the Federal Reserve’s widely anticipated decision to cut its benchmark interest rate by 25 basis points to 3.75%. This marked a continuation of its easing cycle aimed at supporting economic growth amid signs of labor market cooling and subdued inflationary pressures. Risk assets rallied following the announcement, though the Fed’s steady outlook for rates in 2026 capped further downside for the U.S. dollar.
December 11: Australia Employment Data and SNB Decision
Australia’s November employment report beat expectations with a gain of 17,600 jobs, surpassing forecasts of a 15,000 increase. The unemployment rate also fell to 4.2%, better than the expected 4.3%, providing support for the Australian dollar late in the week.
In Switzerland, the Swiss National Bank (SNB) held its policy rate at 0.00% during its Q4 meeting, citing tame inflationary pressures. The Swiss franc (CHF) eased slightly against major peers, with USD/CHF declining by 0.42% week-on-week.
December 12: German CPI Beats Expectations; U.S. Rig Count Declines
Germany reported a slight upside surprise in its November CPI data, which rose by 2.4% year-over-year compared to expectations of 2.3%. The euro (EUR) gained on the news, with EUR/USD advancing by 0.38% over the week.
In the U.S., Baker Hughes reported a modest drop in its total rig count to 587 from 600 previously, signaling tighter supply conditions in energy markets. Crude oil prices rose on the news, supported by ongoing supply concerns.
Equity Markets
Global equities posted modest gains this week as investors digested central bank decisions and economic data that pointed toward stabilizing growth and a potential soft landing for key economies.
U.S. Equities
The S&P 500 rose by 0.8% to close at 6,025, while the Dow Jones Industrial Average gained 0.4% to end at 43,900. The tech-heavy Nasdaq outperformed with a 1.2% weekly gain to reach 25,200, driven by strong performances in technology and financial stocks.
The CBOE Volatility Index (VIX) declined to 16.66, reflecting a calm market environment as traders adjusted their positions ahead of year-end flows.
European Equities
European markets also posted gains, buoyed by stable economic data and improving sentiment around global growth prospects. The FTSE 100 rose by 0.2%, while the EuroStoxx gained 1.1% and Germany’s DAX added 0.9%.
Asian Equities
In Asia, Japan’s Nikkei advanced by 0.5%, while Hong Kong’s Hang Seng climbed by 0.6%, supported by China’s strong export data and easing deflation concerns. The Shanghai Composite rose by 0.7%, rounding out a positive week for regional markets.
Forex Markets
The U.S. dollar softened this week following the Federal Reserve’s dovish rate cut and softening labor market data, with the DXY index declining by 0.5% to close at 99.05.
- EUR/USD: The euro gained 0.38% against the dollar to close at 1.045, supported by stronger-than-expected German CPI data.
- GBP/USD: The British pound rose by 0.22% to end the week at 1.272.
- USD/JPY: The yen weakened slightly against the dollar, with USD/JPY rising by 0.35% to settle at 155.20.
- AUD/USD: The Australian dollar edged higher by 0.10% to close at 0.652 after upbeat employment data.
- USD/CAD: The Canadian dollar remained flat against its U.S. counterpart at 1.362 (-0.02% WoW).
- USD/CHF: The Swiss franc strengthened by 0.42% against the dollar to close at 0.842.
- NZD/USD: The New Zealand dollar gained modestly during the week.
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Commodities & Cryptocurrencies
Crude oil prices rose this week as supply concerns were amplified by a decline in U.S. rig counts and geopolitical uncertainties in key producing regions.
- WTI Crude: Gained over $2 per barrel to close above $78.
- Gold: Held steady near $1,950 per ounce amid mixed risk sentiment.
Cryptocurrencies rebounded from early-week losses as risk appetite improved post-Fed decision, with Bitcoin climbing back above $37,000.
Conclusion
The second week of December brought a mix of monetary policy decisions and economic data that underscored both opportunities and risks heading into year-end trading conditions. The Federal Reserve’s rate cut was a pivotal moment, reinforcing hopes for a soft landing while keeping markets cautiously optimistic amid lingering uncertainties.
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Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice.