Summary
This market report reviews macroeconomic and market developments in November and December 2025. In the US, delayed jobs data showed weak payroll growth — just 64,000 in November — while the unemployment rate rose to 4.6%, the highest since 2021. Wage growth slowed to 0.1%, and the job market remains constrained by tighter immigration policies. The Fed cut interest rates by 0.25% to a range of 3.50%–3.75%, while also announcing renewed Treasury purchases amid liquidity concerns.
Euro area inflation ticked up to 2.2% in November, with the ECB expected to hold rates steady at its December meeting. Inflation diverged across the bloc: Cyprus held steady at 0.2%, while Greece jumped to 2.9%.
Oil prices dropped 7% over the month due to oversupply fears and progress on a potential Russia-Ukraine peace deal. Gold surged 7.4% to record highs ($4,368), while Bitcoin fell 7.5% to $86,060 amid broader risk-off sentiment.
US equities reached new highs mid-December before pulling back on weak tech/AI performance. Nvidia, Microsoft, and Meta all saw notable declines, while the Dow and old economy stocks outperformed. European equities posted solid gains, with Germany’s DAX up 3.4%.
Yields rose across the board in the US and Europe, steepening the yield curve and boosting bank stocks. Cyprus 10-year yields rose to 3.17%. The EURO STOXX Banks Index is up 76% year-to-date, marking its best year ever.
The US dollar weakened modestly, with gains in the euro, sterling, and Canadian dollar. The yen fell sharply by 4.6% vs the dollar.
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