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GLOBAL markets were shaped this week by central bank updates and fresh US economic data. With policy decisions from the Federal Reserve, European Central Bank and Bank of England as expected, investors turned their attention to jobs and inflation figures.
As the year draws to a close, trading has been influenced more by routine end-of-period activity than new developments, with bond yields steady, gold near record highs and equities broadly flat. Investors reacted positively to the US inflation report for November, which came in softer than expected.
US job growth painted a mixed picture in November. Payrolls increased modestly, yet unemployment hit its highest level in four years, according to delayed Bureau of Labor Statistics data. Broader measures of underemployment also rose, reflecting low hiring and workforce constraints. Despite these weaker trends, the White House emphasised positive economic momentum, pointing to rising wages and ongoing investment. Markets expect little immediate impact on Federal Reserve policy and do not anticipate another interest-rate cut in January.
Investors also digested the final European interest-rate decisions of 2025. The European Central Bank, Norway’s Norges Bank and Sweden’s Riksbank all kept rates unchanged, signalling cautious optimism over their respective economies.
The Bank of England, in contrast, cut its benchmark interest rate to 3.75%, its fourth reduction this year. The move reflects softening growth, a weaker labour market and slowing inflation. Sterling and the FTSE 100 were largely unchanged, while gilt yields rose slightly. Economists expect gradual reductions to continue in early-2026, though elevated wage expectations could temper the pace.
Energy markets weakened as hopes of progress towards peace in Ukraine eased supply concerns. Oil prices dropped to their lowest levels in months, reflecting abundant global supply, which outweighed tensions surrounding Venezuela, where the US has threatened action against sanctioned shipments bound for China.
In contrast, precious metals strengthened. Gold hit a new all-time high, surpassing $4,400 an ounce for the first time, supported by anticipated interest-rate cuts, geopolitical uncertainty and buying from central banks. Silver also rose to a record high of $69 an ounce, benefiting from both safe-haven demand and its growing industrial use in green technologies.
Precious metal mining stocks continue to benefit from the soaring demand for gold and silver. Fresnillo, the London-listed silver miner headquartered in Mexico City, rose another 9% last week to extend its year-to-date gains to 456%.
Elsewhere, in corporate news, shares in the UK-based online trading platform IG Group jumped 13% over the week after the company announced an extension of its share buyback programme by £75 million to £200 million. The move reflects continued strong trading conditions, with revenues boosted by an influx of new clients, a broader product offering and effective marketing campaigns.
Novo Nordisk’s shares jumped 6% in early trading on Tuesday following the approval from the US Food and Drug Administration to sell a daily pill version of its Wegovy injection. The approval was based on the results of the Oasis 4 trial which found that people who took a daily 25 milligram Wegovy pill lost around 17% of their body weight over 64 weeks. It will be available for $149 from early January.
In contrast, shares in Diageo fell more than 3% on Monday, extending its year-to-date declines to 34%, after a report revealed that alcohol consumption in the UK has fallen to a record low owing to aging demographics, health concerns, higher prices and the growing use of weight loss jabs such as Ozempic and Wegovy. The average adult in the UK consumed 10.2 drinks a week last year, compared to 14 two decades ago.
Crypto markets, meanwhile, remained subdued. Outflows from Bitcoin exchange-traded funds continued following last year’s rally, while other major cryptocurrencies, including Ether, Solana and Ripple, drifted lower, reflecting ongoing caution among investors. Trading is set to slow as markets close for the Christmas period. Many European exchanges will shut part-way through the week, while activity on Wall Street is expected to be lighter than usual, despite a shorter holiday break.
