Thursday Roundup
December 11, 2025
Many other central banks made interest rate announcements the day after the Federal Reserve’s fed funds target was cut on Wednesday by 25 basis points by a split vote of 10-2-1 with District Presidents Schmid and Goolsbee preferring to leave the rate unchanged at 3.75-4.0% and Governor Miran promoting a more aggressive 50-basis point reduction.
Rate cuts of 25 basis points in Hong Kong, Macao, Qatar, Bahrain, Kuwait and the United Arab Emirates were preordained by the Fed’s action. Monetary policy in Hong Kong has been subordinated since March 1983 to a fixed exchange rate policy that circumscribes the Hong Kong dollar’s movement to a very narrow band centered on 7.8 HKD per USD. Macau’s currency is tied to the Hong Kong dollar. The policy interest rates in both those countries now becomes 4.0%. After 25-bp cuts, the new central bank rate levels are now at 4.0% in Bahrain, 3.85% in Qatar, 3.65% in the UAE and3.5% in Kuwait.
At the Central Bank of Turkey, officials implemented a slightly smaller-than-expected 150-basis point reduction of their policy interest rate to 38.0%, which is it’s lowest level since November 2023 and down from a peak of 50% from March 2024 until December of that year. By most countries’ standards, Turkish consumer price inflation of 31.1% last month is very high, but for Turkey that was down from 75.5% in May 2024 and its lowest point in four years.
At the National Bank of Ukraine, “inflation is declining somewhat faster than the NBU forecast, but inflation expectations remain high.” Accordingly, officials as expected left their policy rate at 15.5%, which is the level its been since a series of hikes from 13.0% a year ago to the current level following a 100-bp increase this past August. Officials project a gradual deceleration of inflation over coming months but also view the uncertain course of the war with Russia to be a major risk factor.
The interest rate of the National Bank of Serbia was not changed today, either. Such has been at 5.75% since a cut of 25-bp in September 2024. Officials expect inflation to hover near the 3% midpoint of their target for the time being.
The policy rate of the Central Bank of the Philippines was lowered another 25 basis points to 4.5%. That’s two full percentage points below the peak maintained from October 2023 until August 2024. CPI inflation last month of 1.5% was below the 2-4% target but is deemed likely to stay not far from 3% in policy time horizon.
At the National Bank of Moldova, the policy interest rate was reduced by 100 basis points to 5.0%, which happens to also be the inflation target of the bank. Moldovan CPI inflation of 7.0% now is well above that level, but officials expect it to decelerate.
The Central Bank of Peru’s key interest rate was left at 4.25% today as had been expected. The rate was cut a total of 350 basis points between September 2023 and this past September.
Switzerland’s central bank interest rate was left unchanged at zero percent. Swiss inflation is only 0.2%. Officials do not rule out returning to a sub-zero interest rate and retain a readiness to intervene if deemed necessary for keeping the franc from becoming more overvalued.
Thursday’s financial market highlight, one day after the Fed show, was a rise of about 1.3% in DOW and Russell 2000. Movement in long-term interest rates were modest. The dollar fell moderately against both the yen and euro. Bitcoin dropped around 0.6%, and WTI oil’s price slid similarly.
Last week’s 236K increase in new U.S. jobless insurance claims was the most in 13 weeks and 44K greater than in the previous week, but continuing claims in the prior week dropped to a near eight-month low.
The September U.S. trade deficit of $52.8 billion was at a 63-month low and smaller than forecast, but the deficit of $765 billion over the first nine months of $765 billion was 17% greater than a year earlier. Canada reported an unexpected C$ 153 million trade surplus.
Icelandic consumer price inflation fell to a 59-month low in November.
Australia’s jobless rate in November of 4.3% was the same as in October, while a rise of 21.3 thousand jobs was the smallest employment increase in 9 months.
Copyright 2025, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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