December 19th Financial Breakfast: US inflation data boosts expectations of interest rate cuts; gold prices retreat slightly but hold above $4330; crude oil prices weigh geopolitical influences.
2025-12-19 07:30:46
On Friday (December 19, Beijing time) in early Asian trading, spot gold was trading around $4,336 per ounce. Gold prices fell slightly on Thursday as weaker-than-expected US inflation data diminished gold's appeal as an inflation hedge, but support from rising unemployment limited the decline. US crude oil was trading around $56 per barrel, with the market weighing the escalating supply-side risks due to the Russia-Ukraine peace talks and the situation in Venezuela.
Bank of Japan Governor Kazuo Ueda held a press conference on monetary policy. Several European Central Bank officials also spoke.
U.S. stocks rose across the board on Thursday, mainly driven by lower-than-expected inflation data that boosted expectations of a Federal Reserve rate cut, while strong earnings guidance from chip giant Micron highlighted robust demand for artificial intelligence.
At the close, the Dow Jones Industrial Average rose 0.14%, the S&P 500 gained 0.79%, and the Nasdaq Composite surged 1.38%. The market rebounded from a three-week low, with the small-cap Russell 2000 index also rising 0.8%.
The U.S. November Consumer Price Index (CPI) rose less than expected year-on-year, and this "constructive CPI report" further eased policy pressure on the Federal Reserve. Although October and month-on-month data were not released due to the government shutdown, the market still viewed it as a positive signal. In addition, initial jobless claims fell last week, indicating that the labor market remains stable. Interest rate futures markets show that traders currently believe there is a 58% probability that the Fed will take dovish action in March next year.
In terms of individual stocks, technology stocks performed exceptionally well. Micron Technology surged 10.2% after reporting quarterly profit guidance that was nearly double analysts' expectations, reflecting strong demand related to AI. Trump Media & Technology Group shares jumped 41% after the company announced a more than $6 billion all-stock merger with nuclear fusion company TAE Technologies. Additionally, Lululemon rose 3.5% due to a stake acquired by activist investors, and Starbucks gained 4.9%.
Gold prices edged lower on Thursday as the market digested the latest U.S. inflation data. The data showed that consumer prices rose 2.7% year-on-year in November, below the expected 3.1%, which diminished gold's appeal as an inflation hedge. However, support from rising unemployment limited the decline in gold prices.
At the close, spot gold fell 0.2% to settle at $4,330.39 per ounce. Market analysts believe that the faster-than-expected decline in inflation reduced demand for gold as an "inflation insurance" measure, which was the main reason for the downward pressure on gold prices. However, analysts generally believe that the overall upward trend in gold remains unchanged, with some strategists setting an upward target of $4,515.63 and considering $5,000 as a valid target.
Spot silver retreated 1.5% to $65.30 after hitting a record high of $66.88. Platinum and palladium performed strongly, with platinum rising 1.2% to a more than 17-year high and palladium surging 3.7% to a near three-year high. Analysts pointed out that the upward momentum in precious metals has spread from silver to platinum, which is benefiting from strong demand.
International oil prices closed slightly higher on Thursday as markets weighed escalating supply-side risks from the Russia-Ukraine peace talks and the situation in Venezuela. Brent crude settled up 0.2% at $59.82 a barrel, while WTI crude rose 0.4% to $56.15.
Geopolitics has become the focus of the market. According to Bloomberg, the US is prepared for a new round of sanctions against Russia's energy sector in case Moscow rejects a peace agreement. Meanwhile, President Trump stated that negotiations to end the war are "on the verge of progress," and US and Russian officials will meet this weekend.
In Venezuela, although the country's state-owned oil company partially resumed loading operations after a cyberattack, the US blockade of sanctioned tankers has brought most of its exports to a standstill. Market analysts point out that if the blockade continues, local production may be forced to halt due to a lack of export outlets.
The dollar weakened against the yen and Swiss franc on Thursday, mainly due to weaker-than-expected U.S. inflation data for November, which reduced the dollar's appeal; meanwhile, the euro edged down after the European Central Bank kept interest rates unchanged.
Specifically, data showed that the U.S. Consumer Price Index (CPI) rose 2.7% year-on-year in November, lower than the 3.1% expected in the survey. This caused the dollar to fall 0.12% against the yen to 155.50 yen, and 0.14% against the Swiss franc. Analysts pointed out that the accuracy of this inflation report is questionable due to the impact of the prolonged government shutdown on data collection, and the market is closely watching the more traditional PCE price index.
On the other hand, the euro fell 0.14% against the dollar to $1.17240. The European Central Bank decided to keep interest rates unchanged at its meeting and expressed a positive view on the resilience of the eurozone economy, but this did not change market expectations that interest rates would remain unchanged for the next two years.
The pound rose slightly by 0.09%** after the Bank of England announced its fourth interest rate cut this year, with the market anticipating a postponement of the next rate cut. Meanwhile, the Bank of Japan is almost certain to raise interest rates on Friday, increasing them from 0.5% to 0.75%.
The US sanctions 29 shadow oil tankers transporting oil to Iran.
The United States imposed sanctions on 29 oil tankers and their management companies on Thursday, targeting a "shadow fleet" transporting oil and petroleum products for Iran. The U.S. Treasury Department said the sanctioned ships and companies transported hundreds of millions of dollars worth of petroleum products through deceptive means.
Japan's holdings of US Treasury bonds rose to $1.2 trillion.
Data from the U.S. Treasury Department shows that Japan's holdings of U.S. Treasury securities increased to $1.2 trillion in October from $1.189 trillion in September. China's holdings of U.S. Treasury securities decreased to $688.7 billion in October from $700.5 billion in September.
Zelensky: Ukrainian lawmakers have not yet reached a consensus on key issues such as amending the election law.
Ukrainian President Volodymyr Zelenskyy said on the 18th that members of the Verkhovna Rada (parliament) have not made progress on amending the electoral law, nor have they reached a consensus on holding online voting for the presidential election. Zelenskyy stated that he is willing to hold a presidential election in Ukraine, but "has not considered holding Rada (parliamentary) and local elections."
The Gaza ceasefire mediators will meet in the US to discuss the second phase of the ceasefire.
On the 18th local time, a White House official announced that U.S. Special Envoy for the Middle East, Mr. Witkov, will meet with senior officials from Qatar, Egypt, and Turkey in Miami on the 19th to discuss the second phase of the Gaza ceasefire. It is understood that Qatar, Egypt, Turkey, and the United States believe that both Israel and Hamas are delaying and avoiding the implementation of the second phase of the ceasefire agreement; therefore, all parties urgently hope to develop a joint plan to push both sides to fulfill their commitments. (CCTV News)
The Central Bank of Brazil raised its economic growth forecast for the country this year and next.
On December 18th local time, the Central Bank of Brazil stated in its Monetary Policy Report that the Brazilian economy is projected to grow by 2.3% in 2025, an increase from the previously released 2.0% growth forecast; the economic growth forecast for 2026 has been revised upwards from 1.5% to 1.6%. The report noted that since September, Brazil's domestic inflation level and inflation expectations have declined somewhat, but remain above the 3% target. Brazil's inflation rate is expected to remain above 3% in 2027, and is not projected to reach the target value until 2028. (CCTV News)
Ursula von der Leyen: The signing of the EU-Mercosur free trade agreement will be postponed until January next year.
European Commission President Ursula von der Leyen told EU leaders at the summit that the EU-Mercosur free trade agreement will not be signed as originally planned this Saturday (20th), but will be postponed until January next year. Meanwhile, Brazilian President Lula has reportedly agreed to Italian Prime Minister Meloni's request for a postponement to appease Italian farmers and address their concerns about the potential impact of cheap poultry and beef imports on the country's agriculture.
Trump granted the federal government two extra days off, but the NYSE announced that stock trading would continue as usual around Christmas.
Following President Trump's executive order shutting down the federal government on December 24th and 26th, the New York Stock Exchange (NYSE) stated it would not change trading hours for those two days around Christmas. The NYSE had previously moved its closing time for December 24th to 1 p.m. The exchange posted a notice on its website stating that December 26th would be a normal full trading day.
US Democratic lawmakers are calling for an investigation into Commerce Secretary Lutnick and his family for allegedly profiting improperly from AI data centers.
Twenty-five Democratic lawmakers have sent a letter to the Commerce Department's Inspector General's office, requesting an investigation into whether Commerce Secretary John Lutnick improperly promoted an artificial intelligence data center project to benefit his family. The letter, spearheaded by Massachusetts Senator Elizabeth Warren and Pennsylvania Representative Madeline Dean, was sent on Thursday. An investigation last month revealed a persistent overlap between Lutnick's official actions since taking office and the businesses of his former companies. Lutnick previously transferred his role in the Cantor Fitzgerald corporate network to his two sons, and the four children now jointly hold controlling stakes. Several of Lutnick's official actions intersect with projects of family-affiliated companies. For example, in tariff negotiations with South Korea, he requested billions of dollars in investment from South Korea to support U.S. industry, while Cantor and Newmark are assisting in financing a proposed AI data center in Amarillo, Texas, which is seeking a share of South Korean funding.
China's renewable energy growth was named the top breakthrough of the year by the US journal Science, leading the global energy transition.
On March 18, the journal *Science* announced its list of the top ten scientific breakthroughs for 2025, with "Unstoppable Global Renewable Energy Growth" being named the number one breakthrough. The journal argues that by 2025, global renewable energy production will begin to surpass traditional energy in several sectors, a major transformation primarily led by China. China continues to expand its presence in areas such as solar panels, wind turbines, and lithium-ion battery energy storage, consolidating its leading position in global renewable energy production and related technologies.
Fuzhou's first downtown duty-free shop opens; customers with valid entry and exit documents can enjoy duty-free shopping.
Downtown duty-free shops are stores approved by the State Council and established in accordance with regulations to sell duty-free goods to departing passengers. On December 18th, Fuzhou, Fujian Province, officially opened its first downtown duty-free shop, one of the first eight newly established downtown duty-free shops nationwide. Located in the core business district of Gulou District, Fuzhou, the shop covers an area of 857 square meters and is divided into duty-free and taxable goods areas. Products sold include perfumes, cosmetics, bags, watches, jewelry, popular trendy toys and health products. It is understood that duty-free goods sold at the downtown duty-free shop will be packaged under customs supervision and sent to the duty-free goods collection point in the departure area of Fuzhou Changle International Airport. Customers can collect their goods by presenting their purchase receipts and valid entry/exit documents. (CCTV News)
Key Focus Today
Bank of Japan Governor Kazuo Ueda held a press conference on monetary policy. Several European Central Bank officials also spoke.
stock market
U.S. stocks rose across the board on Thursday, mainly driven by lower-than-expected inflation data that boosted expectations of a Federal Reserve rate cut, while strong earnings guidance from chip giant Micron highlighted robust demand for artificial intelligence.
At the close, the Dow Jones Industrial Average rose 0.14%, the S&P 500 gained 0.79%, and the Nasdaq Composite surged 1.38%. The market rebounded from a three-week low, with the small-cap Russell 2000 index also rising 0.8%.
The U.S. November Consumer Price Index (CPI) rose less than expected year-on-year, and this "constructive CPI report" further eased policy pressure on the Federal Reserve. Although October and month-on-month data were not released due to the government shutdown, the market still viewed it as a positive signal. In addition, initial jobless claims fell last week, indicating that the labor market remains stable. Interest rate futures markets show that traders currently believe there is a 58% probability that the Fed will take dovish action in March next year.
In terms of individual stocks, technology stocks performed exceptionally well. Micron Technology surged 10.2% after reporting quarterly profit guidance that was nearly double analysts' expectations, reflecting strong demand related to AI. Trump Media & Technology Group shares jumped 41% after the company announced a more than $6 billion all-stock merger with nuclear fusion company TAE Technologies. Additionally, Lululemon rose 3.5% due to a stake acquired by activist investors, and Starbucks gained 4.9%.
Gold Market
Gold prices edged lower on Thursday as the market digested the latest U.S. inflation data. The data showed that consumer prices rose 2.7% year-on-year in November, below the expected 3.1%, which diminished gold's appeal as an inflation hedge. However, support from rising unemployment limited the decline in gold prices.
At the close, spot gold fell 0.2% to settle at $4,330.39 per ounce. Market analysts believe that the faster-than-expected decline in inflation reduced demand for gold as an "inflation insurance" measure, which was the main reason for the downward pressure on gold prices. However, analysts generally believe that the overall upward trend in gold remains unchanged, with some strategists setting an upward target of $4,515.63 and considering $5,000 as a valid target.
Spot silver retreated 1.5% to $65.30 after hitting a record high of $66.88. Platinum and palladium performed strongly, with platinum rising 1.2% to a more than 17-year high and palladium surging 3.7% to a near three-year high. Analysts pointed out that the upward momentum in precious metals has spread from silver to platinum, which is benefiting from strong demand.
oil market
International oil prices closed slightly higher on Thursday as markets weighed escalating supply-side risks from the Russia-Ukraine peace talks and the situation in Venezuela. Brent crude settled up 0.2% at $59.82 a barrel, while WTI crude rose 0.4% to $56.15.
Geopolitics has become the focus of the market. According to Bloomberg, the US is prepared for a new round of sanctions against Russia's energy sector in case Moscow rejects a peace agreement. Meanwhile, President Trump stated that negotiations to end the war are "on the verge of progress," and US and Russian officials will meet this weekend.
In Venezuela, although the country's state-owned oil company partially resumed loading operations after a cyberattack, the US blockade of sanctioned tankers has brought most of its exports to a standstill. Market analysts point out that if the blockade continues, local production may be forced to halt due to a lack of export outlets.
Foreign exchange market
The dollar weakened against the yen and Swiss franc on Thursday, mainly due to weaker-than-expected U.S. inflation data for November, which reduced the dollar's appeal; meanwhile, the euro edged down after the European Central Bank kept interest rates unchanged.
Specifically, data showed that the U.S. Consumer Price Index (CPI) rose 2.7% year-on-year in November, lower than the 3.1% expected in the survey. This caused the dollar to fall 0.12% against the yen to 155.50 yen, and 0.14% against the Swiss franc. Analysts pointed out that the accuracy of this inflation report is questionable due to the impact of the prolonged government shutdown on data collection, and the market is closely watching the more traditional PCE price index.
On the other hand, the euro fell 0.14% against the dollar to $1.17240. The European Central Bank decided to keep interest rates unchanged at its meeting and expressed a positive view on the resilience of the eurozone economy, but this did not change market expectations that interest rates would remain unchanged for the next two years.
The pound rose slightly by 0.09%** after the Bank of England announced its fourth interest rate cut this year, with the market anticipating a postponement of the next rate cut. Meanwhile, the Bank of Japan is almost certain to raise interest rates on Friday, increasing them from 0.5% to 0.75%.
International News
The US sanctions 29 shadow oil tankers transporting oil to Iran.
The United States imposed sanctions on 29 oil tankers and their management companies on Thursday, targeting a "shadow fleet" transporting oil and petroleum products for Iran. The U.S. Treasury Department said the sanctioned ships and companies transported hundreds of millions of dollars worth of petroleum products through deceptive means.
Japan's holdings of US Treasury bonds rose to $1.2 trillion.
Data from the U.S. Treasury Department shows that Japan's holdings of U.S. Treasury securities increased to $1.2 trillion in October from $1.189 trillion in September. China's holdings of U.S. Treasury securities decreased to $688.7 billion in October from $700.5 billion in September.
Zelensky: Ukrainian lawmakers have not yet reached a consensus on key issues such as amending the election law.
Ukrainian President Volodymyr Zelenskyy said on the 18th that members of the Verkhovna Rada (parliament) have not made progress on amending the electoral law, nor have they reached a consensus on holding online voting for the presidential election. Zelenskyy stated that he is willing to hold a presidential election in Ukraine, but "has not considered holding Rada (parliamentary) and local elections."
The Gaza ceasefire mediators will meet in the US to discuss the second phase of the ceasefire.
On the 18th local time, a White House official announced that U.S. Special Envoy for the Middle East, Mr. Witkov, will meet with senior officials from Qatar, Egypt, and Turkey in Miami on the 19th to discuss the second phase of the Gaza ceasefire. It is understood that Qatar, Egypt, Turkey, and the United States believe that both Israel and Hamas are delaying and avoiding the implementation of the second phase of the ceasefire agreement; therefore, all parties urgently hope to develop a joint plan to push both sides to fulfill their commitments. (CCTV News)
The Central Bank of Brazil raised its economic growth forecast for the country this year and next.
On December 18th local time, the Central Bank of Brazil stated in its Monetary Policy Report that the Brazilian economy is projected to grow by 2.3% in 2025, an increase from the previously released 2.0% growth forecast; the economic growth forecast for 2026 has been revised upwards from 1.5% to 1.6%. The report noted that since September, Brazil's domestic inflation level and inflation expectations have declined somewhat, but remain above the 3% target. Brazil's inflation rate is expected to remain above 3% in 2027, and is not projected to reach the target value until 2028. (CCTV News)
Ursula von der Leyen: The signing of the EU-Mercosur free trade agreement will be postponed until January next year.
European Commission President Ursula von der Leyen told EU leaders at the summit that the EU-Mercosur free trade agreement will not be signed as originally planned this Saturday (20th), but will be postponed until January next year. Meanwhile, Brazilian President Lula has reportedly agreed to Italian Prime Minister Meloni's request for a postponement to appease Italian farmers and address their concerns about the potential impact of cheap poultry and beef imports on the country's agriculture.
Trump granted the federal government two extra days off, but the NYSE announced that stock trading would continue as usual around Christmas.
Following President Trump's executive order shutting down the federal government on December 24th and 26th, the New York Stock Exchange (NYSE) stated it would not change trading hours for those two days around Christmas. The NYSE had previously moved its closing time for December 24th to 1 p.m. The exchange posted a notice on its website stating that December 26th would be a normal full trading day.
US Democratic lawmakers are calling for an investigation into Commerce Secretary Lutnick and his family for allegedly profiting improperly from AI data centers.
Twenty-five Democratic lawmakers have sent a letter to the Commerce Department's Inspector General's office, requesting an investigation into whether Commerce Secretary John Lutnick improperly promoted an artificial intelligence data center project to benefit his family. The letter, spearheaded by Massachusetts Senator Elizabeth Warren and Pennsylvania Representative Madeline Dean, was sent on Thursday. An investigation last month revealed a persistent overlap between Lutnick's official actions since taking office and the businesses of his former companies. Lutnick previously transferred his role in the Cantor Fitzgerald corporate network to his two sons, and the four children now jointly hold controlling stakes. Several of Lutnick's official actions intersect with projects of family-affiliated companies. For example, in tariff negotiations with South Korea, he requested billions of dollars in investment from South Korea to support U.S. industry, while Cantor and Newmark are assisting in financing a proposed AI data center in Amarillo, Texas, which is seeking a share of South Korean funding.
Domestic News
China's renewable energy growth was named the top breakthrough of the year by the US journal Science, leading the global energy transition.
On March 18, the journal *Science* announced its list of the top ten scientific breakthroughs for 2025, with "Unstoppable Global Renewable Energy Growth" being named the number one breakthrough. The journal argues that by 2025, global renewable energy production will begin to surpass traditional energy in several sectors, a major transformation primarily led by China. China continues to expand its presence in areas such as solar panels, wind turbines, and lithium-ion battery energy storage, consolidating its leading position in global renewable energy production and related technologies.
Fuzhou's first downtown duty-free shop opens; customers with valid entry and exit documents can enjoy duty-free shopping.
Downtown duty-free shops are stores approved by the State Council and established in accordance with regulations to sell duty-free goods to departing passengers. On December 18th, Fuzhou, Fujian Province, officially opened its first downtown duty-free shop, one of the first eight newly established downtown duty-free shops nationwide. Located in the core business district of Gulou District, Fuzhou, the shop covers an area of 857 square meters and is divided into duty-free and taxable goods areas. Products sold include perfumes, cosmetics, bags, watches, jewelry, popular trendy toys and health products. It is understood that duty-free goods sold at the downtown duty-free shop will be packaged under customs supervision and sent to the duty-free goods collection point in the departure area of Fuzhou Changle International Airport. Customers can collect their goods by presenting their purchase receipts and valid entry/exit documents. (CCTV News)
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
