10th December 2025

MACRO

Trump Conducts Final Interviews for Fed Chair

President Trump is in final interviews for the next Federal Reserve chair, with Kevin Warsh, Kevin Hassett, Michelle Bowman, Christopher Waller, and BlackRock’s Rick Rieder as the reported finalists. “We’re going to be looking at a couple of different people, but I have a pretty good idea of who I want,” Trump said on Air Force One. Separately, Trump suggested he could challenge the legality of some Biden-era Fed appointments, claiming his predecessor used an autopen to sign them.

(Wall Street Journal, Reuters)

Japan Faces Inflation Spiral Concerns as Yen Stays Weak

Markets are increasingly worried about Japan’s “tail risk” of slipping into a negative spiral where monetary tightening lags inflation and a weak yen pushes prices higher, according to Mitsubishi UFJ’s markets chief. PM Takaichi said currencies should reflect fundamentals and the government remains prepared to act against “excessive and disorderly moves.”

Short-term JGB yields hit a 17-year high on Wednesday as certainty grows the BOJ will resume rate hikes next week. Wholesale prices rose 2.7% year-on-year in November, unchanged from October. Japan is also considering expanding taxes on the ultra-rich by lowering the threshold from 3 billion yen to 600 million yen.

(Reuters, NHK)

China Inflation Ticks Up But Factory Deflation Worsens

Consumer inflation rose 0.7% year-on-year in November, slightly below expectations but the highest since March 2024, driven mainly by recovering food prices. However, producer prices dropped 2.2% year-on-year, raising doubts about sustainability. Chinese property stocks surged on stimulus speculation and progress in China Vanke’s debt talks.

The IMF upgraded China’s growth forecasts and called for a “more forceful policy package” to reduce dependence on exports and investment. China also added domestic AI chips from Huawei and Cambricon to its government procurement list for the first time.

(Wall Street Journal, Bloomberg, Financial Times)

ECB Officials Split on Rate Path

ECB Governing Council member Francois Villeroy de Galhau said there’s no reason to raise rates soon after likely holding at next week’s meeting. But fellow member Gediminas Simkus said rates don’t need to be lowered further after stronger-than-expected activity and inflation. Berlin stands ready to back a German candidate to succeed Lagarde, though it sees little chance of securing the presidency.

(Bloomberg, Financial Times)

Australia Rate Debate Heats Up

Two of Australia’s top economists find themselves in opposing camps over the RBA’s next move after Governor Bullock’s surprise hawkish shift prompted investors to boost bets on a hike as early as February. Victoria is proceeding with its first petroleum exploration tenders in seven years to address looming gas supply risks.

(Bloomberg)

US Domestic Developments

Senate Majority Leader John Thune said Republicans would vote later this week on a measure to control healthcare costs amid party division over how to prevent big price increases next year. Trump tried to reassure Americans the economy was healthy at a campaign-style rally as Republicans brace for tough midterms. A record number of Americans are expected to hit the road over December holidays as gas prices slide to pandemic-era lows.

The US is also proposing that foreign visitors provide five years of social media history to enter the country, including those from visa-waiver nations like Australia, Germany, Japan and the UK.

(Wall Street Journal, Reuters, Bloomberg)

European Developments

The EU reached a binding climate agreement to cut greenhouse gas emissions 90% by 2040 from 1990 levels. European firms are accelerating efforts to diversify away from Chinese supply chains as Beijing’s self-reliance drive deepens trade uncertainty. Italian PM Meloni’s party faces criticism for proposing to double the legal cash payment limit to €10,000, with critics accusing it of promoting tax evasion. UK asset managers, banks and the London Stock Exchange agreed to fund a government-backed campaign to encourage retail investment.

(Reuters, Financial Times)

Energy and Commodities

Kazakhstan said it would redirect some oil from the Kashagan field to China after a Ukrainian drone attack on a Baltic Sea terminal. Four of India’s seven largest refiners are now seeking Russian crude as deep discounts push buyers toward non-sanctioned barrels. Iron ore risks becoming detached from physical market reality as financial speculation drives prices more than underlying supply and demand, according to China Mineral Resources Group.

(Reuters, Bloomberg)

GEOPOLITICAL

US Criticises China Over Japan Radar Incident

The US has for the first time criticised China for aiming radars at Japanese military aircraft during a training exercise last week. Russian and Chinese bombers flew near Japan and South Korea in a joint patrol Tuesday that Tokyo described as a show of force, adding strain to the worst diplomatic crisis in years between Tokyo and Beijing.

(Reuters, Wall Street Journal)

Red Sea Shipping Shows Signs of Recovery

French container shipping group CMA CGM is planning more journeys through the Suez Canal as commercial vessels weigh returning to the Red Sea after Yemen’s Houthi rebels signalled a halt to strikes in the region.

(Financial Times)

Ukraine Funding Progress

The EU is very close to a solution to finance Ukraine in 2026 and 2027 with support from at least a qualified majority of member countries, summit chairman Antonio Costa said. Russia says it’s waiting for a US response on New START nuclear arms treaty proposals.

(Reuters)

Thailand-Cambodia Border Tensions

Thailand and Cambodia accused each other of targeting civilians in border attacks as Trump said he would make a phone call to stop the fighting and salvage a ceasefire he brokered in July.

(Reuters)

Other Geopolitical Developments

Denmark’s military intelligence warned the country faces more external threats than in many years amid rising conflicts and doubts over US commitment to European security. Turkey must no longer possess Russia’s S-400 air defence system if it wants back into the F-35 program, US envoy Tom Barrack said.

(Reuters, Bloomberg)

EQUITIES

Amazon Commits $35 Billion to India

Amazon plans to invest more than $35 billion in India by 2030 to expand operations, boost AI capabilities and increase exports - a major bet on the fast-growing market.

(Reuters)

Nvidia China Decision Faces Bipartisan Backlash

China hardliners and Democratic lawmakers slammed the Trump administration for allowing Nvidia to ship H200 chips to China, warning Beijing could use the technology for military purposes. Taiwan said the US has not yet announced details on the 25% charge for the sales.

(Reuters)

GE Vernova Boosts Shareholder Returns on Power Demand

GE Vernova expects higher 2026 revenue driven by strong power demand, boosted its buyback plan by $4 billion to $10 billion, and doubled its quarterly dividend to 50 cents. The company expects 80 gigawatts of signed gas turbine contracts by year-end as Big Tech’s data centre buildout accelerates. GE Vernova is also working with the US government to stockpile rare earth yttrium as China’s export controls create shortages.

(Reuters)

Palantir Wins Navy Contract for Submarine Production

The US Navy is turning to Palantir as part of its years-long effort to speed up submarine production, betting the company’s analytics can better expose supply chain problems.

(Bloomberg)

Elliott Takes Stake in Toyota Industries

Activist investor Elliott has taken a 5.01% stake worth 268 billion yen ($1.71 billion) in Toyota Industries - a company that Toyota Motor hopes to buy out.

(Reuters)

SK Hynix Explores New York Listing

SK Hynix is exploring a potential New York share listing to close the valuation gap with global peers including Micron Technology.

(Bloomberg)

China Vanke Rallies on Restructuring Progress

China Vanke rallied in equity and credit markets after a bondholder meeting included discussion of sweetened terms for the distressed builder’s effort to delay a note payment.

(Bloomberg)

Coupang CEO Resigns Over Data Breach

Coupang CEO Park Dae-jun resigned over what is viewed as the worst data breach case in South Korea, following police raids on the company’s headquarters.

(Wall Street Journal)

Moore Threads Jumps on AI Chip Announcement

Shares of Chinese chipmaker Moore Threads jumped as much as 27% in Shanghai after the recent market debutant said it would release new AI chip products next week.

(Bloomberg)

Other Notable Moves

Hedge funds betting on drug stocks have made bumper profits as pharma dealmaking drives the biggest biotech rally in a decade. UK quantum computing startup Nu Quantum raised $60 million in one of the largest UK Series A rounds. Dutch insurer Aegon confirmed it will move headquarters to the US and rename itself Transamerica. Berkeley Group said UK home sales declined heading into the budget. Poland’s biggest defence holding seeks to ramp up European sales and cooperate with Rheinmetall, Thales and BAE.

(Financial Times, Bloomberg)

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