The November inflation figures in the United States were so low that everyone thought: "Something’s off." Except, of course, for those who took them at face value because the numbers suited either their convictions or their financial interests. Wall Street roared with delight upon hearing that consumer price inflation had eased to 2.7% last month, compared with 3% expected. This is the lowest level since 2021, and it simultaneously bolsters Donald Trump’s narrative ("my tremendous tariffs come with all the upsides and no drawbacks") and the prospect of monetary easing ("with inflation slowing and the labour market tightening, there’s no reason not to loosen monetary policy").

Wall Street took the figures at face value, even if the indices lost some altitude from their early-session surge. The Nasdaq climbed 1.5%, the S&P 500 rose nearly 0.8%, and the Dow Jones edged up by 0.1%. The Russell 2000 small-cap index, highly sensitive to rate-cut expectations, gained just 0.6% - a sign of lingering skepticism: had investors fully embraced the inflation print, the Russell would likely have ended the day up more than 2%.

The trouble with the November data lies in its incompleteness, as acknowledged by the Bureau of Labor Statistics, which publishes it. The 43-day federal government shutdown skewed data collection and left glaring holes in several series. Moreover, the data primarily reflects the second half of November: a period when Black Friday sales temporarily depress prices across certain product categories. Kevin Hassett, Donald Trump's economic advisor and a contender for the Fed chairmanship, hailed the numbers as "simply sensational." In the same camp, Stephen Miran - recently appointed to the Fed by the President - offered a more nuanced take. He noted that it’s hardly fair, to quote him, "to accept all upward biases and rush to dismiss any downward ones. Or vice versa. Let’s be clear-eyed about both." Still, he did preach to the choir by suggesting that the inflation print is likely close to the true underlying rate. A compelling narrative can outshine any data set.

This debate is far from trivial. The reliability of macroeconomic data is critical to sound policymaking, in any country. Some of the most significant monetary policy missteps have stemmed from flawed data, later revised. Given the massive machinery involved and the sums at stake with every shift in direction, the quality of these indicators is non-negotiable.

Before Wall Street began tying itself in knots over inflation, Europe had already closed higher. The Stoxx Europe 600 even posted a record closing high at 585 points, supported across all ten major sectors - especially industry, consumer cyclicals, technology, basic materials, and finance. The CAC 40, DAX, and SMI each rose between 0.8% and 1%. The two European monetary policy decisions announced yesterday - the ECB's hold and the Bank of England's rate cut - came as no particular surprise. Nor did this morning’s move by the Bank of Japan. Japanese rates were lifted from 0.50% to 0.75%. That might seem trivial, but it’s the highest level in 30 years for a country that endured the scourge of deflation from the late 1990s through 2021. Since then, prices have picked up, with Japanese inflation reaching 2.9% in November.

The final session of the week could be somewhat lively. On the one hand, it’s the last trading day before the Christmas week. On the other, it's monthly and quarterly options expiry, which typically brings bursts of volatility at key moments.

In the Asia-Pacific region, Wall Street’s rebound after Wednesday’s rough day inspired markets. Japan gained 1%, while Hong Kong and South Korea advanced by 0.6%. Mainland China, Australia, and India posted more modest gains. However, European futures are trending lower, as US futures point downward: investors wary of excessive optimism following the contentious inflation figures.

Before moving on, note that this is the final column of 2025: the team has unanimously decided to take a break from 4:30 a.m. alarms for the next two weeks. We take this opportunity to wish you a joyful festive season and all the best for 2026. See you in the New Year.

Today's economic highlights:

On today's agenda: the PPI in Germany and France; in the United Kingdom, retail sales excluding auto fuel; in the United States, the annualized GDP, the Core PCE Price Index MoM and YoY, existing home sales, personal income, consumer spending, and the University of Michigan sentiment. See the full calendar here.

  • GBP / USD: US$1.34
  • Gold: US$4,324.83
  • Crude Oil (BRENT): US$59.64
  • United States 10 years: 4.14%
  • BITCOIN: US$87,939.1

In corporate news:

  • Chesterfield Special Cylinders Holdings reported a narrowed annual loss and a 12% increase in revenue due to new contracts in the defence and hydrogen sectors.
  • Capital Metals PLC reported an interim loss of USD 1.1 million for the six months ending September 30, due to higher expenses and lack of revenue from its Taprobane minerals project.
  • CyanConnode reported increased revenue in its interim results, yet faced a larger loss, leading to a 17% drop in its share price.
  • Surgical Innovations Group PLC saw its stock plummet by 36% following reduced revenue forecasts due to a decline in procedures caused by the flu, NHS strikes, and a supply quality issue.
  • DXS International PLC announced a security incident that had minimal impact on its services.
  • Enel received an upgraded outlook from S&P to positive, maintaining its BBB long-term and A-2 short-term ratings, with plans to issue up to 2 billion euros of non-convertible hybrid bonds in 2026.
  • Pirelli converted €496.5 million of its €500 million equity-linked bonds into 84.9 million new common shares, diluting the holdings of Sinochem and Camfin.
  • Nexi rejected TPG's offer to acquire its digital banking assets and canceled the proposed deal for its DBS unit.
  • Clariant divested its Venezuelan operations for USD 1.8 million.
  • NOBA Bank Group expanded its banking footprint by acquiring SME lender DBT Capital for 403 million SEK in a cash transaction.
  • BMW launched a second share buyback program valued at up to €625 million.
  • Safilo Group acquired a 25% stake in Inspecs Group for £21.7 million.
  • Dominion Hosting Holding completed an accelerated bookbuilding, raising €8.2 million and announced a partial, paid capital increase up to €10 million.
  • Odfjell Drilling signed a contract for its Deepsea Aberdeen rig, securing its deployment for upcoming projects.
  • Nike reported modest sales growth in Q2 2025, with revenue surpassing forecasts despite challenges in China.
  • OpenAI is expanding its influence through partnerships and new initiatives, including a significant fundraising goal and collaborations with the U.S. Department of Energy and Oracle.
  • TikTok agreed to sell 80% of its U.S. operations to a joint venture including Oracle, Silver Lake, and MGX to address national security concerns.
  • Micron's Q2 earnings forecast is influencing AI-focused tech stocks.
  • Pershing Square invested USD 1 billion in non-voting exchangeable perpetual preferred stock of Howard Hughes Holdings.
  • Pangaea Logistics Solutions Ltd. appointed Eugene I. Davis to its board of directors.
  • Artis Real Estate Investment Trust and RFA Capital received final court approvals for their plan of arrangement.

See more news from UK listed companies here

Analyst Recommendations:

  • Volution Group Plc: RBC Capital maintains its outperform rating and raises the target price from GBX 765 to GBX 780.
  • Integrafin Holdings Plc: RBC Capital maintains its outperform rating and raises the target price from GBX 440 to GBX 450.
  • Jet2 Plc: Barclays maintains its overweight recommendation and raises the target price from GBP 20.80 to GBP 21.25.
  • Carnival Corporation & Plc: UBS maintains its buy recommendation and raises the target price from GBX 2400 to GBX 2600.
  • Croda International Plc: Morgan Stanley maintains its equalwt recommendation and reduces the target price from GBX 3050 to GBX 3030.
  • Dassault Aviation: Rothschild & Co Redburn maintains its buy recommendation and reduces the target price from EUR 365 to EUR 340.
  • Sanofi: Berenberg maintains its buy recommendation and reduces the target price from EUR 110 to EUR 105.
  • Thyssenkrupp Nucera Ag & Co. Kgaa: Berenberg maintains its hold recommendation and reduces the target price from EUR 10 to EUR 9.
  • Ovs S.p.a.: Mediobanca maintains its outperform recommendation and raises the target price from EUR 4.50 to EUR 4.80.