The EUR/USD moved to a three month high amid expectations of further Fed interest rate cuts in 2026.
The British pound also climbed to a three month high as the greenback weakened against most of its rivals, despite expectations that the Bank of England is also likely to cut interest rates next year.
The USD/JPY pulled back last week, even after Friday’s lower than expected Tokyo inflation data, with markets expecting another Bank of Japan rate hike soon.
Gold prices pushed sharply higher and posted a record high on safe haven demand and Fed rate cut expectations in 2026.
US S&P 500 stocks jumped last week as the ‘Santa Claus’ rally sent the index to fresh new highs. Stronger than expected US GDP figures showed that the economy remained robust, despite trade concerns earlier this year.
Oil prices rose to a two week high, but surrendered most of those gains by Friday. Oil’s price was supported by a US blockade of Venezuela, but news that President Zelensky would meet President Trump on Sunday suggested progress on a peace deal between Russia and Ukraine was being made.