Closing in on the End of 2025
December 30, 2025
The release this afternoon of minutes from the FOMC’s policy review earlier this month will be the last meaningful economic event of this year. Many stock markets will in fact be closed tomorrow, including those in Japan, Germany, Italy, Switzerland, Sweden, Argentina and Venezuela. Others will close early such as those in Great Britain, France, Hong Kong and the Benelux countries.
Thus far in 2025, the dollar shows double-digit losses 13.7% against the Mexican peso, 13.0% relative to the Swiss franc and 11.9% versus the euro and has also depreciated by 7.7% against the Australian dollar, 7.3% vis-a-vis sterling, 4.6% relative to the Canadian dollar, 4.0% versus the Chinese yuan but just 0.8% relative to the Japanese yen on balance. Overnight dollar movements this Tuesday have been inconsequential.
Ten-year sovereign debt yields have risen today by three basis points in Spain and Italy and by two basis points in the United States, Germany, France and Japan. The Japanese Nikkei fell 0.4% today. Taiwan’s stock market also slipped 0.4%, while the Chinese and Australian markets held steady. Hong Kong’s Hang Seng index rose 0.9%, and gains in major European stock exchanges range from 0.5% so far in France and Great Britain to 1.1% in Italy.
The prices of gold (+1.7%), Bitcoin (+0.9%) and oil (+0.4%) have each moved higher so far today.
The October Case-Shiller U.S. house price index, a survey encompassing 20 metropolitan areas, fell 0.3% in October, representing the fifth straight month without an increase and resulting in a 1.3% year-on-year advance or roughly half the 2.8% year-on-year rise in May before this streak. While the FHFA index of U.S. house prices rose 0.4% in October, its 12-month increase dipped to 1.7% from 1.8% in September and 2.4% in both July and August.
Despite a 0.1-point uptick to an 11-month high of 52.3 in Russia’s service sector purchasing managers index this month, the composite PMI of service sector businesses and manufacturers declined a tenth of a point to a neutral 50.0 reading, its weakest since September’s depressed 46.6 score.
Economic sentiment in Turkey this month matched November’s 8-month high. The Turkish jobless rate was 8.6% in November for the third time in four months following a 3-month low of 8.5% in October.
The KOF-compiled leading business indicator of the Swiss economy improved 1.7 index points to a 15-month high of 103.4 this month. So far this decade, such has ranged between 129.5 in April 2021 to 86.4 in August 2022.
Spain experienced a record current account surplus in October of EUR 7.18 billion, but the year-to-date surplus of EUR 51.0 billion was still 3.2% smaller than during the first ten months of 2024.
South Korea recorded a smaller year-on-year drop in industrial production (-1.4%) in November than October’s plunge of 8.2%, while retail sales there posted a 2-month high increase of 0.8% compared to a year earlier.
Retail sales in Portugal were 6.4% greater in November, their greatest year-on-year advance in 43 months. A 1.4% year-on-year rise in Croatian retail sales was their smallest advance in 32 months. On-year growth in Latvian retail sales declined to a 2-month low of 3.3% last month.
From a peak of 10.8% in July 2022, consumer price inflation in Spain had receded to as low as 1.5% by September 2024 but had climbed back to 3.1% this past October. December’s 2.9% CPI rate was a tick above market expectations but still at a 4-month low.
Slovenian consumer prices recorded no monthly movement in both November and December, which trimmed the 12-month rate of increase to 2.7% from a 17-month high of 3.1% in October.
Greek producer price inflation of 0.1% in November was above zero for the first time since June’s 1.6% reading. Austrian producer price inflation has stayed under zero percent for the past eight reported months including -1.3% in November. In Bulgaria, however, PPI inflation exceeded 10% for a second straight month with a reading of +12.0% last month.
Copyright 2025, Larry Greenberg. All rights reserved.
Tags: South Korean retail sales and industrial production, Spanish current account and CPI, U.S. house prices
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