Portfolio Update – December 2025

General news

• On 01/12/2025, Oil prices rose after OPEC+ confirmed it will pause production increases in early 2026, citing supply-glut concerns. Brent reached $62.99 and WTI $59.12 as geopolitical risks added support, including uncertainty after U.S. President Trump suggested closing Venezuelan airspace and renewed tensions in the Russia-Ukraine conflict, with Ukraine striking Russian oil sites. Analysts said the OPEC+ outcome was expected, but global supply risks continue to drive market volatility.
• On 02/12/2025, The U.S. and U.K. reached a deal to remove tariffs on pharmaceuticals and medical technology, with Britain agreeing to spend more on medicines by raising the prices it pays for new drugs by 25%. In return, UK-produced medicines, ingredients and medical tech will be exempt from U.S. Section 232 tariffs. The agreement also requires a major change to NICE’s drug-value assessment framework, which guides what treatments the NHS can fund. The move follows U.S. pressure for Europe to pay more for American medicines, amid industry complaints that the UK market has become difficult and has discouraged investment. As part of the deal, Britain will also reduce its NHS rebate rate for drugmakers to 15% in 2026.
• Japanese government bond yields surged — with the two-year hitting its highest level since 2008 — after Bank of Japan Governor Kazuo Ueda signaled the possibility of a December rate hike. Ueda said the outlook for the economy is improving and that monetary conditions would remain accommodative even with higher rates, prompting markets to sharply increase expectations of a near-term hike. The yen strengthened, while yields rose across maturities, including the 5-year and 10-year bonds, both reaching levels last seen in 2008. Swaps now price in an over 80% chance of a hike on Dec. 19, up from 23% a week earlier, and more than 94% odds by January.
• On 03/12/2025, Australia’s economy grew 2.1% in the third quarter—its fastest pace in nearly two years but slightly below forecasts—driven by strong domestic demand and a surge in private investment, especially in machinery, equipment, and data centers. Despite the softer headline number, economists say underlying activity remained robust, with domestic demand and consumption rising, though aggressive inventory write-downs and weak net trade dragged on growth. Inflation accelerated to 3.8% in October, keeping pressure on the Reserve Bank of Australia, which is expected to hold rates at 3.6% but may still consider further tightening as the economy shows signs of operating near capacity.
• On 04/12/2025, The U.S. labor market weakened further in November as private payrolls fell by 32,000, sharply missing expectations and driven almost entirely by a 120,000 job loss among small businesses, ADP reported. While larger firms added 90,000 jobs, broad declines across sectors—especially professional and business services, information, manufacturing, and construction—pushed overall employment lower, though education and health services posted modest gains. Wage growth also cooled to 4.4% annually. With the ADP report arriving just before the Fed’s Dec. 9–10 meeting, markets continue to price in a high likelihood of another rate cut as policymakers debate how to balance labor market softness against persistent inflation.
• On 05/12/2025, India’s central bank cut its policy rate by 25 basis points to 5.25%, in line with expectations, citing softer economic indicators and easing inflation. Governor Sanjay Malhotra said strong growth and a favorable inflation outlook allowed the RBI to remain supportive. To address recent rupee weakness and maintain liquidity, the bank will buy 1 trillion rupees in government bonds and execute a $5 billion buy-sell dollar swap. The rupee recently fell past 90 per dollar, though reserves remain strong at $686.2 billion. Economists called the cut timely amid uncertainty, noting it likely helped prevent potential bond-market volatility.
• China’s big state-owned banks bought dollars in the onshore market this week to curb the yuan’s rapid appreciation, which pushed the currency to a 14-month high. Unlike usual practice, they held the dollars instead of swapping them back, a move seen as tightening dollar liquidity to raise the cost of long-yuan positions. The tactic lowered back-end dollar/yuan swap points and increased the negative carry for yuan holders. While the goal was to slow — not reverse — the yuan’s climb, the currency weakened slightly after the activity surfaced. The People’s Bank of China did not comment, and sources said banks may have acted for the central bank, themselves, or clients.
• On 08/12/2025, A six-year-old federal program known as Subchapter V, created to give small U.S. businesses a cheaper and faster path to debt relief, has reached a record number of filings, with more than 2,200 cases this year. Rising borrowing costs, weaker consumer spending, and the Trump administration’s trade pressures are pushing more small firms toward bankruptcy, with Subchapter V filings growing over 8% compared with a modest 1% rise in traditional Chapter 11 cases. Despite last year’s reduction of the program’s debt limit from $7.5 million to about $3 million, participation has continued to increase, driven by both small companies and individuals carrying business-related debts. Consumer bankruptcy filings under Chapter 13 have also climbed, totaling over 180,000 so far this year.
• On 09/12/2025, China’s exports rebounded in November with a 5.9% annual increase, lifting its 2025 trade surplus above $1 trillion for the first time, despite a nearly 29% drop in shipments to the U.S. While exports to America continue to slide, China is expanding sales across Southeast Asia, Africa, Europe and Latin America. November exports of $330.3 billion beat expectations, and imports rose slightly to $218.6 billion. Economists say the recent U.S.–China trade truce and tariff cuts may boost exports further, though China’s factory activity remains weak. Analysts expect China to meet its 5% growth target and continue gaining global export share, particularly in advanced manufacturing sectors like EVs, robotics and batteries.
• President Trump announced a $12 billion aid package funded by tariff revenues to support farmers hurt by the ongoing trade war. About $11 billion will be directed to a new USDA Farmer Bridge Assistance program offering one-time payments, with the remaining $1 billion set aside as market conditions evolve. While the administration says the aid will help farmers transition to its new economic agenda, Democratic lawmakers argue Trump’s tariffs are raising costs, hurting exports and pushing farms toward bankruptcy. The trade conflict, especially with China, has disrupted key markets like soybeans, with China halting purchases for months and only partially resuming buying despite a tentative trade truce. The administration maintains China will meet its target of 12 million metric tons of U.S. soybean purchases, though volumes remain below past levels.
• On 10/12/2025, President Donald Trump said Nvidia will be allowed to sell its H200 AI chips to approved customers in China and other regions, provided the U.S. receives a 25% revenue cut — a proposal he said Chinese President Xi Jinping has accepted. The Commerce Department is finalizing details, and the same policy will apply to AMD, Intel and other U.S. chipmakers. Nvidia and AMD had already agreed in August to share 15% of China chip-sale revenue, though China later discouraged use of Nvidia’s lower-grade H20 chip. Nvidia said the H200 plan balances competition and national interests. The approval comes as semiconductors remain central to the U.S.–China technology rivalry and follow a recent trade truce in which China agreed to stop retaliating against U.S. chipmakers after Trump and Xi met in late October.
• On 11/12/2025, China’s consumer inflation rose 0.7% in November — its highest in nearly two years — while producer prices fell 2.2%, deepening deflation and highlighting weak domestic demand amid ongoing trade tensions. Core inflation held at 1.2%, supported by higher gold prices, while headline CPI was lifted by a rebound in food costs, though monthly CPI dipped 0.1% as travel-related prices cooled post-holiday. Despite targeted stimulus boosting categories like appliances and clothing, economists warn deflationary pressures persist due to weak consumption, a sluggish labor market and excess industrial supply forcing manufacturers to cut prices. China’s exports remain a bright spot, driving a record $1 trillion trade surplus so far this year and helping the economy stay on track for its “around 5%” growth target. Policymakers have prioritized boosting domestic demand and rebalancing supply for 2026, with markets awaiting guidance from the upcoming Central Economic Work Conference.
• The Federal Reserve delivered a widely expected “hawkish cut” on Wednesday, lowering its benchmark interest rate by 0.25 percentage points to 3.5%–3.75% but signaling a more difficult path for future reductions. The decision exposed sharp internal divisions, with a rare three dissents — the first since 2019 — as Governor Stephen Miran pushed for a larger half-point cut, while Kansas City Fed President Jeffrey Schmid and Chicago Fed President Austan Goolsbee wanted to keep rates unchanged. It marked Miran’s third consecutive dissent and Schmid’s second, reflecting an ongoing split between policymakers prioritizing inflation control and those emphasizing support for the labor market.
• On 12/12/2025, U.S. home prices have slipped slightly year-over-year for the first time since 2023, falling about 1% nationally and 1.4% over the past three months, according to Parcl Labs’ high-frequency listing data. The softening follows the sharp rise in mortgage rates during 2022–2023, which created an affordability shock that weakened demand and forced sellers to adjust. Inventory remains low but is rising, with active listings up 13% from last year. Some markets, like Austin (-10%), Denver (-5%) and Tampa (-4%), are seeing deeper declines, while cities such as Cleveland (+6%), Chicago and New York (+5%) continue to post gains. With mortgage rates holding steady and builder sentiment still weak, analysts expect home prices to remain near zero growth — hovering slightly positive or negative — rather than returning to the pandemic-era surge.
• On 13/12/2025, Japan is beginning an extremely gradual exit from its massive ETF holdings, planning to sell more than $500 billion worth of assets over decades to avoid disrupting already fragile global markets. The Bank of Japan, which holds ¥83 trillion in ETF market value, will sell about ¥330 billion annually—a pace that could take over a century—pausing if major financial shocks occur, with Sumitomo Mitsui Trust Bank managing the process as officials closely monitor heightened regional and global market risks.
• On 17/12/2025, U.S. nonfarm payrolls rose by 64,000 in November, beating expectations, but October jobs were revised to a 105,000 decline as unemployment climbed to 4.6%, its highest in four years, highlighting a cooling labor market amid data disruptions from the government shutdown. Job gains were concentrated in healthcare and construction, while government, transportation and leisure jobs fell, wage growth slowed to 3.5% year-on-year, and the Federal Reserve signaled caution on further rate cuts despite having lowered rates to 3.5%–3.75%.
• On 19/12/2025, U.S. consumer inflation cooled more than expected in November, with headline CPI rising 2.7% year over year and core inflation at 2.6%, both below forecasts, fueling optimism that the Federal Reserve could ease policy further. Monthly price gains also undershot expectations, though the report was affected by the government shutdown and missing October data, prompting caution among economists. Still, markets reacted positively, with stocks rising, bond yields falling, and traders increasing the odds of a March rate cut after the Fed’s third consecutive quarter-point reduction earlier this month.
• The Bank of England narrowly voted 5–4 to cut its benchmark interest rate by 25 basis points to 3.75% on Thursday, marking its fourth cut of 2025, amid weak economic data, a softening labor market and easing inflation. Governor Andrew Bailey sided with dovish members despite inflation still running at 3.2%, above the 2% target, with the MPC saying price growth is expected to return to target more quickly but future easing will depend on inflation trends. Markets were largely unmoved, while the cut offers relief to borrowers but lowers returns for savers, with Chancellor Rachel Reeves welcoming the move as support for households and businesses facing cost-of-living pressures.
• On 24/12/2025, The U.S. economy expanded at a much faster-than-expected 4.3% annualized rate in the third quarter, driven mainly by strong consumer spending, which rose 3.5%, along with gains in exports and government spending. Despite the robust growth, inflation pressures remained elevated, with the Fed’s preferred PCE inflation measure at 2.8% and core inflation at 2.9%, both above the central bank’s 2% target, while markets reacted little to the delayed, backward-looking data.
• Gold and silver prices surged to fresh records as investor demand for safe havens grew amid fears of an AI-driven market bubble and uncertainty over future Federal Reserve leadership. Gold futures climbed to around $4,506 an ounce after hitting a record high, while silver jumped above $70 an ounce for the first time, marking strong gains for both metals this year. Analysts say the rally reflects under-ownership of metals and rising concerns over expanding global debt, with some forecasting further upside ahead.
• The Trump administration said it will raise tariffs on Chinese semiconductor imports starting June 23, 2027, with the rate to be set at least a month in advance, while keeping tariffs at zero for the next 18 months. The delay follows a USTR investigation that found China engages in unfair trade practices and signals an effort to ease near-term U.S.–China trade tensions after an October truce. The move gives U.S. companies clarity on future costs, with the measures focused on older chips under Section 301 and separate from potential tariffs under Section 232.
• On 29/12/2025, Nearly 328,000 student loan borrowers had their applications to switch into income-driven repayment (IDR) plans denied in August, leaving many stuck with higher payments or in interest-accruing forbearance, according to a court filing. With more than 800,000 additional applications still pending, advocates warn the denials could delay loan forgiveness under IDR and Public Service Loan Forgiveness programs and increase monthly costs for borrowers. The issue affects a system relied on by millions of the 42 million Americans holding over $1.6 trillion in student debt and has drawn legal scrutiny over the Education Department’s handling of the backlog.
• President Donald Trump said peace talks to end the Russia-Ukraine war made significant progress after meeting Ukrainian President Volodymyr Zelenskyy in Florida, though major disputes over territory remain unresolved. Trump said the sides were “very close” to a deal, while Zelenskyy described the talks as productive and said U.S.-Ukraine security guarantees were largely agreed upon, with further meetings planned next month involving European leaders. Both leaders acknowledged that control of disputed land in eastern Ukraine, including the Donbas region, remains the main obstacle, as Russia continues battlefield advances and attacks on Ukrainian infrastructure, underscoring the high stakes and uncertainty surrounding a final agreement.
• On 30/12/2025, Silver and gold pulled back on Monday after hitting record highs, as investors took profits and easing geopolitical tensions reduced demand for safe-haven assets. Spot gold fell 1.4% to about $4,471 an ounce and silver dropped nearly 5% to around $75 after briefly topping $80, while platinum and palladium saw even sharper declines. Despite the retreat, bullion remains strongly higher this year, with gold up roughly 72% and silver up 181%, supported by looser monetary policy, dollar weakness and strong demand, as markets now await the Federal Reserve’s December meeting minutes for signals on interest rates.
• SoftBank agreed to acquire data center investment firm DigitalBridge for $4 billion, buying all outstanding shares at $16 each in a deal approved by DigitalBridge’s board and expected to close in the second half of next year. The offer represents a 15% premium to DigitalBridge’s Dec. 26 close and sent its shares up about 10%. SoftBank CEO Masayoshi Son said the acquisition will strengthen infrastructure for next-generation AI and support the company’s push to become an “Artificial Super Intelligence” platform, as global demand surges for data centers and related AI infrastructure.
• On 31/12/2025, Silver futures surged about 7% early Tuesday, rebounding to around $75.5 an ounce after a volatile session that saw prices briefly hit a record $80 before suffering their biggest one-day drop since 2021, leaving year-to-date gains near 158%. Gold also recovered from Monday’s sell-off, while copper edged higher, as precious metals continued to benefit from safe-haven demand, inflation hedging, a weaker dollar, and supply concerns. However, some analysts expect commodities performance in 2026 to shift toward more cyclical materials as global growth picks up, potentially reducing the appeal of defensive precious metals, even as silver demand remains supported by its widespread industrial use and looming Chinese export restrictions.
• SoftBank has completed its $40 billion investment in OpenAI, sending a final $22–$22.5 billion last week, lifting its stake above 10% in the AI company valued at about $260 billion pre-money. The investment, partly earmarked for AI infrastructure including the Stargate venture with Oracle, underscores SoftBank’s renewed push into AI after selling its Nvidia stake to fund the deal. OpenAI, which has secured more than $1.4 trillion in infrastructure commitments and backing from firms like Microsoft, Amazon and Disney, is also reportedly preparing for a future IPO.