Market Information Thursday 18 December 2025

UK inflation fell to 3.2 per cent in November from 3.6 per cent, undershooting forecasts and easing pressure on policymakers as growth weakens. Markets are close to fully pricing a quarter point rate cut to 3.75 per cent, with unemployment at 5.1 per cent and output down 0.1 per cent in October. Sterling slipped 0.7 per cent and two-year gilt yields fell to 3.73 per cent, reinforcing expectations of further easing.

Japan’s exports rose 6.1 per cent year on year in November, beating expectations on strong demand from the US and EU and a 13 per cent rise in semiconductor shipments. Imports grew just 1.3 per cent, pushing the trade balance to a 322bn yen surplus and supporting near term growth. Core machinery orders jumped 7 per cent month on month, reinforcing expectations of a fourth quarter recovery despite lingering uncertainty over trade with China.

Oil rebounded from a four and a half year low as US threats of tougher action against Russia and a blockade of Venezuelan oil lifted prices, with WTI rising up to 2.7% to almost $57 a barrel. Washington warned it could target Russian oil flows and ordered a naval blockade of sanctioned Venezuelan tankers, yet Venezuela accounts for under 1% of global supply, about 590,000 barrels a day. Markets stayed cautious as an expected surplus, the largest since the pandemic, left traders heavily short and capped the rally.

The 6M Euribor decreased with 1 basis point to 2.16% compared to previous business day. The 10Y Swap increased with 1 basis point to 2.93% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.