Weekly Analysis

Global markets faced a volatile week as institutional stability in the US was tested by a criminal investigation into Federal Reserve Chair Jerome Powell.

Global markets entered 2026 with the US dollar extending its sharpest annual decline in eight years, pressured by a shrinking yield advantage and uncertainty surrounding the new administration’s tariff agenda.

Global markets concluded the year with the US dollar hitting its weakest point since early October, as expectations for the Federal Reserve easing in 2026 intensified.

Global markets faced a volatile week as investors balanced softening US economic data against tightening signals from other major central banks.

Global markets wrapped the week with notable moves across currencies, commodities, and bond markets amid fresh central‑bank signals and key economic releases. The Federal Reserve delivered its third consecutive 25 bps rate cut, while signaling only one more cut in 2026, tempering easing expectations. That, coupled with hawkish leanings from other major central banks, pressured the dollar yet again.

Traders adjusted positioning before the Federal Reserve’s December decision and evaluated fresh signals from the ECB, BoE and BOJ.

Global financial markets closed the first week of December with renewed confidence in an imminent Federal Reserve rate cut, as soft U.S. data and dovish Fed commentary lifted risk assets and precious metals. The dollar remained steady, Treasury yields eased, and commodities diverged on geopolitical headlines. European inflation surprised slightly higher, while Japan’s economic strength added pressure on bond yields amid aggressive fiscal stimulus.

Markets rebounded this week with rising expectations of a Fed rate cut in December, following dovish remarks from New York Fed President Williams and mixed labor data.