The final week before the Christmas holidays typically ushers in reduced volatility and the entrenchment of existing trends in financial markets. However, 2026 appears to have different plans. The close of the year will bring a series of crucial, delayed data releases from the United States, alongside two key interest rate decisions from the Eurozone and Japan. Accordingly, the most critical markets to observe this week are EURUSD, USDJPY, and the US100 index.
EURUSD
The world’s most important currency pair has surged to its highest levels since October. This ascent is primarily driven by the notably dovish signal from Federal Reserve Chair Jerome Powell, who anticipates weakness in the labor market, despite growing dissent within the Fed regarding the path of future rate movements next year. Unusually, due to the need for more time to gather data, the NFP (Non-Farm Payrolls) report will be released on Tuesday, December 16th. CPI inflation, meanwhile, is scheduled for publication on Thursday, December 18th. That same day, we will also receive the European Central Bank (ECB) rate decision, which could potentially deliver a hawkish surprise, given the recent revival in inflation and potentially improved growth forecasts for the Eurozone.
USDJPY
US data releases will exert a significant influence on the USDJPY pair, which attempted a renewed pushback towards a downtrend last week. The strengthening of the yen in November was linked to communication suggesting the Bank of Japan (BOJ) would likely raise interest rates. Beyond the decision itself, the forward guidance will be key. While interest rates are expected to remain low, Japanese bond yields are currently at their highest level since 2007, suggesting that the USDJPY pair should fundamentally trade at a significantly lower level. This scenario would require not only weaker data from the US but also hawkish rhetoric from the Bank of Japan and a clear signal of further rate hikes.
US100
We have now seen the publication of important financial reports from companies such as Oracle, Adobe, and Broadcom. Although most firms presented significant growth momentum, considerable doubts emerged regarding the Artificial Intelligence (AI) sector following disappointments relative to consensus estimates for both Oracle and Broadcom. Nevertheless, should US data suggest lower inflation and possible further cooling in the labor market, while the economy remains robust, the US100 has an opportunity to continue its move toward historical highs, mirroring the recent trajectory of contracts on the small-cap index, US2000.
The material on this page does not constitute financial advice and does not take into account your level of understanding, investment objectives, financial situation or any other specific needs. All information provided, including opinions, market research, mathematical results and technical analyzes published on the Website or transmitted To you by other means, it is provided for information purposes only and should in no way be construed as an offer or solicitation for a transaction in any financial instrument, nor should the information provided be construed as advice of a legal or financial nature on which any investment decisions you make should be based exclusively To your level of understanding, investment objectives, financial situation, or other specific needs, any decision to act on the information published on the Website or sent to you by other means is entirely at your own risk if you In doubt or unsure about your understanding of a particular product, instrument, service or transaction, you should seek professional or legal advice before trading. Investing in CFDs carries a high level of risk, as they are leveraged products and have small movements Often the market can result in much larger movements in the value of your investment, and this can work against you or in your favor. Please ensure you fully understand the risks involved, taking into account investments objectives and level of experience, before trading and, if necessary, seek independent advice.
