The Week Ahead - 15 - 19 December 2025

United States – This week, we're finally getting some of the much awaited post-shutdown data on the labour market and inflation. We will get both October and November NFP on Tuesday. We expect a week October reading of around 0k, as the major impact of DOGE resignations hits. For November, we expect a strong reading around 110k. There will be an unemployment reading, but it should be taken with a grain of salt. There's no October data, and the November survey was collected later than normal. We expect an uptick to 4.5%, predominantly on the back of the October reading, with some upside risk depending on how furloughed workers during the shutdown answered. Any of that upside risk should therefore reverse, with 4.5% being the more fundamental figure. On Thursday, we get a partial October CPI and a full November CPI reading. We expect core readings of 0.3% for both months, with slightly softer headline readings of 0.2% and 0.3% respectively. This means that headline stands at 3.1% as of November and Core at 3.2%. We'll likely see further tariff pass-through, and some lower than usual leisure-related services with weaker demand throughout the shutdown. Eurozone – We expect the ECB to keep policy on hold. Lagarde will probably be asked at the press conference how she views the recent shift in market pricing towards the next move being a hike rather than a cut. We expect Lagarde to reiterate her neutral language that the ECB is in a ‘good place’. ECB staff will almost certainly raise the 2025 growth forecast, as incoming data has come in somewhat stronger than expected. However, this is very much a backward-looking revision and says little about the future path of policy. We continue to expect the ECB to keep policy on hold over the next two years. UK – We expect the Bank of England to lower rates by 25bp, taking Bank Rate to 3.75%. The recent budget announcement paved the way for this rate cut, as it included measures that will lower inflation by a total of 0.5pp according to BoE estimates. This lowers the risk that recent elevated inflation readings will boost expectations and entrenching higher inflation. Still, we view the space for further rate cuts as limited given still high wage growth and inflation expectations that remain inconsistent with the BoE hitting its 2% inflation target sustainably. CPI inflation, released the day before the BoE meeting, is unlikely to derail the rate cut unless it surprises sharply to the upside. Asia – China’s November activity data (Monday) are expected to confirm the supply side (industrial production) remains clearly stronger than the demand side (retail sales). The annual contraction in investment growth will likely have deepened further, led by property investment. On Friday, we expect the Bank of Japan to continue with its gradual hiking path (given sticky inflation and yen weakness), lifting the target rate by 25bp to 0.75%, in line with consensus expectations and market pricing.