The EUR closed 1.18% lower against the USD during the week, amid a combination of mixed economic data from the Eurozone.

In the Eurozone, the HCOB manufacturing PMI fell in December, signaling ongoing contraction across the region. Germany's PMI recorded a drop to 42.50, reflecting a slowdown in the largest Eurozone economy. In Spain, the consumer price index rose in December, surpassing market expectations but failing to offset the overall manufacturing weakness. Meanwhile, in the US, initial jobless claims dropped to their lowest level in eight months, while the housing market showed signs of strength with pending home sales rising by 2.2% in November.

The USD fell 0.46% against the JPY during the week, driven by strong US economic data and Japan's continued dovish stance on interest rates.

In the US, initial jobless claims fell to 211,000 in the week ending 27 December 2024, marking the lowest level in eight months. The US manufacturing PMI showed a more modest contraction than expected, while pending home sales rose by 2.2% in November. These developments underscored the resilience of the US economy and reinforced expectations of further Federal Reserve tightening, strengthening the US dollar.

Meanwhile, the Japanese yen remained under pressure due to global economic uncertainties, including weakness in China’s manufacturing PMI and ongoing concerns over the economic outlook in Europe. The yen also struggled to gain ground amid the broader strength of the US dollar.

The GBP closed 1.10% lower against the USD during the week, as a combination of weak UK economic data and a robust US labor market report weighed on the pound.

In the UK, December's S&P Global manufacturing PMI dropped its lowest level in nearly a year, signaling continued contraction in the sector. Retail sales data for November also came in weaker than expected, reflecting ongoing struggles in consumer spending. The Nationwide housing prices showed a modest rise in December, slightly above expectations. The Bank of England's dovish stance, indicating caution on future rate hikes, added further bearish pressure on the pound.

Meanwhile, in the US, initial jobless claims unexpectedly fell to their lowest level in eight months, signaling resilience in the labor market.

The GBP closed 1.56% lower against the JPY during the week, as a combination of disappointing UK economic data and a stable Japanese Yen weighed on the British pound.

In the UK, key economic reports were weak, with the December manufacturing PMI falling to 47.5, signaling continued contraction in the sector. UK retail sales for November also underperformed, reflecting persistent challenges in consumer spending. The Bank of England’s cautious stance on interest rates further dampened sentiment, with markets pricing in limited tightening in the coming months.

Meanwhile, the Japanese Yen remained relatively stable, supported by Japan’s continued low-interest rate environment and the Bank of Japan's commitment to maintaining ultra-loose monetary policy. While Japan's economic data was mixed, the yen's status as a safe-haven currency in times of global uncertainty helped it hold firm against the pound.

Oil prices climbed this week, amid optimism over global oil demand outlook. Moreover, the world’s largest crude importer, China’s President Xi Jinping pledged to implement more proactive policies to promote economic growth in 2025, that would lift fuel demand. Additionally, investors await cues on the Federal Reserve's interest rate path for 2025 and the incoming Donald Trump administration's policies.

Meanwhile, the US crude oil inventories fell less than expected last week, while stocks of gasoline and distillate fuels saw large builds with refineries maintaining high-capacity use, according to data released by the US Energy Information Administration (EIA). Commercial crude oil stocks excluding the Strategic Petroleum Reserve fell by 1.2 million barrels to 415.6 million barrels in the week ended 27 December 2024.

Gold prices advanced last week, as risk appetite diminished among investors boosting demand for the safe haven asset. Moreover, key economic data from the US will be closely monitored. Additionally, investors await cues on the Federal Reserve's (Fed) interest rate path for 2025 and the incoming Donald Trump administration's policies. Also, sustained geopolitical risks and a wave of purchases by global central banks further supported the bullion.

Meanwhile, investors anticipate the Fed to adopt a slow and cautious approach to further rate cuts in 2025, as inflation continues to exceed its 2% target.

On the outlook front, the World Gold Council expects prices will rise more slowly in 2025, tempered by variables such as growth and inflation.

Bitcoin’s price climbed last week, amid hopes surrounding more friendly regulatory environment for crypto this year with Donald Trump’s incoming Presidency. Investors anticipate that the Congress will pass its first ever crypto focused legislation, which could be centred around stablecoins or market structure. Also, investors await the key US economic data to provide further direction on the Federal Reserve's (Fed) interest rate path for 2025.

In major news, digital asset brokerage, Falcon has acquired crypto derivatives platform Arbeloa Markets for an undisclosed amount, marking one of the first major crypto acquisition deals of 2025. Separately, crypto exchange, Ku Coin introduced a point-of-sale (Pos) system allowing its users to pay businesses using their exchange balances.