2025-12-31 07:23

SEOUL, Dec 31 (Reuters) - South Korea's foreign exchange authorities sold a net $1.745 billion in currency market intervention transactions in the third quarter, more than double the amount sold in the second quarter, central bank data showed on Wednesday. It was the fourth consecutive quarter authorities sold dollars to curb the won's decline against the dollar. The won was down about 3.7% during the three-month period. Sign up here. https://www.reuters.com/world/asia-pacific/bank-korea-sold-net-1745-billion-fx-intervention-q3-2025-12-31/

2025-12-31 07:11

LONDON, Dec 31 (Reuters) - This past year won’t soon be forgotten. In 2025, conventional thinking about economics and investor behavior was frequently challenged, as dramatic changes in technology, energy and geopolitics drove markets in often unexpected ways. Here are 10 charts that help explain what happened in 2025 and what it might mean for next year. Sign up here. TRADE TANTRUM Donald Trump’s "America First" agenda proved to be a key market driver in 2025 – particularly in the first half of the year – as the U.S. president wasted no time delivering on his campaign promises to shift from free trade to "fair" trade. U.S. trade policy uncertainty – as measured by the Baker-Bloom-David model – hit an all-time high after Trump announced sweeping import tariffs on April 4, "Liberation Day." The index has since eased, but it remains in historically elevated territory, almost double the peaks of Trump's first administration. TARIFF THROWBACK At this time last year, the average effective tariff rate on imports into the U.S. was around 2.5%. It is now almost 17%, the highest level since 1935. This represents the biggest U.S. tax increase as a share of GDP in more than 30 years. To the surprise of many, the U.S. economy and others around the world have coped remarkably well despite this massive change in America’s trade strategy. U.S. GDP grew at a healthy annualized rate of 4.3% in the third quarter. Will consumers and businesses be as resilient next year? That remains an open question. DOLLAR’S ANNUS HORRIBILIS The consensus among Wall Street analysts at the start of 2025 was that the dollar would strengthen as the "U.S. exceptionalism" narrative and Trump administration’s onshoring attracted waves of capital from around the world. Instead, the dollar has fallen around 10% against a basket of major currencies. By the end of June, it was down 12% - its worst first half of any calendar year since the era of free-floating exchange rates began over half a century ago. CONSULTING THE ORACLE The "Magnificent Seven" U.S. technology stocks have dramatically outperformed in 2025, fuelled by the euphoria surrounding artificial intelligence, but as the year progressed, investor concerns grew regarding hyperscalers’ massive, increasingly debt-fuelled AI capex outlays. The share price performance of Oracle (ORCL.N) , opens new tab reflects this trajectory. The U.S. cloud computing giant's stock rose 36% in a single day in September on positive revenue projections, then began to slide, dropping 15% in two days earlier this month - a magnitude of decline seen only during the COVID-19 pandemic, the 2008 global financial crisis and the 1990s dot‑com crash. If Oracle is a bellwether of investors' broader sentiment about AI, there could be a rocky road ahead for the tech-powered equity rally. ‘MY PRECIOUS’ Gold and silver prices have soared in 2025, as safe-haven demand and bets on further U.S. interest rate cuts have fuelled a sharp rally in precious metals. Silver eclipsed $80 an ounce for the first time ever on December 29, driven by strong industrial demand, persistent supply shortfalls, and momentum-driven buying. While gold prices have fallen since hitting a record-high above $4,500 an ounce last week, the yellow metal looks set to deliver its biggest annual gain since 1979. The risk now is that mean reversion will rear its ugly head in 2026, resulting in a sharp and painful pullback. EUROPE RELOADS European defense stocks have more than tripled in value since Russia's invasion of Ukraine in 2022, a war now heading into its fourth year. The sector has gained more than 50% in 2025 alone, spurred by the announcement that Germany will spend up to a trillion euros on defense and infrastructure. This price move speaks to many of this year's global themes, including increasing U.S. isolationism, rising geopolitical tensions and expectations for a European economic reboot. And it also helps explain some other notable 2025 market moves, including the surge in the euro/dollar rate , the outperformance of European stocks versus Wall Street and rising long-dated German bond yields. SUPPLY SHOCK ABSORBER Oil prices jumped from $70 to $81 a barrel after Israel launched a bombing campaign in Iran on June 12, sparking fears that Tehran would block the all-important Strait of Hormuz. But the spike was short-lived as the so-called "12-day war" ended swiftly. This speaks to a longer-term trend: geopolitical tensions still create volatility in energy prices, but price shifts only stick when supply is disrupted, not simply threatened. And even then, global energy markets are increasingly able to adapt, reducing the risk that a surprise event will cause a persistent imbalance between supply and demand. POWER UP The U.S. battery storage market has been the hottest segment of the American energy market in 2025, with capacity on track to jump by a record 12 gigawatts to a total of roughly 40 GW. Meanwhile, China's exports of batteries and battery energy storage systems (BESS) hit a record in 2025, soaring by 24% from the year before over the first nine months of the year. Utility-scale storage systems allow power firms to make better use of renewable power supplies by storing surplus solar output that can then be discharged during peak power demand periods. Battery storage will be a key trend to track in the coming year. ASIA’S SOLAR FLAIR Asia has long been the primary driver of the global solar power industry, manufacturing the vast majority of solar components and accounting for over half of global solar farm installations. In 2025, Asia widened its lead, representing nearly 70% of the global rise in solar generation so far this year as well as a record 59% of all utility-supplied solar power. Given the Trump administration’s pushback on renewables and Europe’s increasing focus on energy security, Asia’s solar dominance may deepen over the next 12 months. POWER DOWN Spain and Portugal suffered an unprecedented power outage on April 28, the largest in Europe's history. A combination of factors - including a solar plant failure and low system inertia - triggered a catastrophic chain reaction. The blackout was resolved quickly, but it exposed the challenges modern power grids face. Policymakers are likely to zero in on such vulnerabilities moving forward as the AI-driven race for power heats up. (The opinions expressed here are those of the author, the Editor in Charge of Reuters Open Interest) Enjoying this column? Check out Reuters Open Interest (ROI), , opens new tab your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI , opens new tab can help you keep up. Follow ROI on LinkedIn, , opens new tab and X. , opens new tab https://www.reuters.com/markets/what-just-happened-ten-charts-help-make-sense-markets-2025-2025-12-31/

2025-12-31 07:10

PARIS, Dec 31 (Reuters) - Eurostar said it would resume all of its cross-Channel services on Wednesday but warned there could still be some delays and last-minute cancellations after a power supply failure suspended train trips for much of Tuesday. The disruption, caused by a fault in the system's overhead power supply, on Tuesday upended plans for thousands of passengers in London, Paris, Brussels and Amsterdam during one of the busiest travel weeks of the year. Sign up here. In a statement on its website on Wednesday morning, high-speed train operator Eurostar said: "Services resumed today following a power issue in the Channel Tunnel yesterday and some further issues with rail infrastructure overnight." "We plan to run all of our services today, however due to knock-on impacts there may still be some delays and possible last-minute cancellations," it said. https://www.reuters.com/business/eurostar-says-train-services-resume-warns-delays-cancellations-2025-12-31/

2025-12-31 06:28

Dec 31 (Reuters) - Australia's Predictive Discovery (PDI.AX) , opens new tab said on Wednesday, shareholders of Canada's Robex Resources (RBX.V) , opens new tab approved a A$2.17 billion ($1.45 billion) merger, paving the way to create a mid-tier gold producer in West Africa. At Robex's special meeting, around 94.54% of votes backed the deal under which Predictive would acquire the Canadian gold miner with Robex shareholders receiving 7.862 fully paid ordinary shares in Predictive for each Robex share. Sign up here. Post-merger, Robex shareholders would own around 46% of the combined entity. The tie-up would create a more diversified gold producer in West Africa, combining Predictive’s Bankan project with Robex’s Kiniero mine, which has recently commenced commissioning activities. These assets, located just 30  kilometres apart in Guinea, offer significant operational synergies , opens new tab. The merged entity would have a market capitalization of around $2.4 billion, as per LSEG data. Shares of the company fell as much as 5.2% earlier in the session before closing 3.9% down. "Investors sell on uncertainty, not headlines," said Greg Boland, market strategy consultant at Moomoo Australia, adding that the drop in the share price reflects integration and execution risks, dilution concerns, as well as profit-taking after a strong rally in gold prices. Predictive, headquartered in Western Australia, was once at the centre of a potential bidding war with fellow miner Perseus Mining (PRU.AX) , opens new tab circling the firm as well. Earlier in December, gold miner Perseus tabled a takeover offer valuing Predictive at A$2.1 billion, higher than Robex's A$1.32 billion bid earlier in October. However, on December 11, Perseus dropped its pursuit of Predictive after rival bidder Robex had hiked its offer to A$2.17 billion. The deal comes at a time of surging gold prices, repeatedly hitting record highs. The bullion has gained over 60% this year and was set to log its best year since 1979. ($1 = 1.4937 Australian dollars) https://www.reuters.com/legal/transactional/robex-shareholders-approve-145-billion-merger-with-australias-predictive-2025-12-30/

2025-12-31 06:13

Rupee repeatedly hit record lows in 2025 RBI adopts flexible approach under governor Malhotra Economists see relief if US trade deal is reached MUMBAI, Dec 31 (Reuters) - The Indian rupee posted its largest annual fall in three years, weighed down by record equity outflows and the lack of a U.S. trade deal that left it out of the rally across Asia, with prospects for a recovery tied to the trade pact. The rupee finished the year at 89.87, marking a annual 4.72% decline, its worst showing since 2022, when it dropped nearly 10%. Sign up here. The currency repeatedly fell to record lows during the year, slipping past the 91 level at one point, highlighting the sustained depreciation pressure. "The rupee's performance this year was largely a capital-flow story, with the RBI adopting a more pragmatic and flexible approach to the exchange rate and allowing the currency to weaken," said Gaura Sen Gupta, an economist at IDFC First Bank. India's balance of payments slipping into a roughly $22 billion deficit between April and November, the largest historically, indicates the external strains facing the economy, Sen Gupta said. A trade deal with the U.S. could offer temporary relief, potentially lifting the rupee to around 88.50 by March, before underlying pressures reassert themselves and the currency weakens again, she said. A Reuters poll broadly aligns with that view. A DIFFERENT STORY FOR THE RUPEE The rupee’s rough patch stands in marked contrast to its rout in 2022, when aggressive rate hikes by the U.S. Federal Reserve fuelled a broad rally in the dollar. In 2025, the backdrop was very different with the dollar index down about 9.5% on Federal Reserve rate cuts and restrictive U.S. trade policy, which supported most Asian currencies. The rupee's underperformance relative to its peers was largely a function of heavy equity outflows and slowing capital inflows elsewhere, economists said. Foreign investors withdrew a record $18 billion from Indian equities in 2025, while debt, external commercial borrowing and foreign direct investment flows were subdued. Prolonged negotiations with the U.S. further compounded the capital flow challenge by reducing predictability around India’s trade outlook. U.S. policy uncertainty dulled appetite for the rupee, setting it apart from Asian peers that faced less tariff-related pressure. SHIFT IN RBI'S APPROACH The Reserve Bank of India's approach to rupee swings saw a change after Sanjay Malhotra became governor in December 2024. Under Malhotra, the RBI has become more tolerant of currency weakness, with its market interventions primarily aimed at managing depreciation expectations and countering the buildup of one-sided speculative positions, bankers said. This change was most evident in mid-December, when the rupee fell past the 91-per-dollar mark for the first time. The RBI intervened heavily to rein in speculative pressures while not defending a specific level, bankers said. The rupee's decline in 2025 alongside the rally in other currencies means the rupee is no longer overvalued. India’s 40-currency trade-weighted real effective exchange rate declined to 97.5 in November from 104.7 in January 2025, according to central bank data. A reading above 100 indicates that a currency is overvalued, while a level below 100 suggests it is undervalued. Dhiraj Nim, an economist and FX strategist at ANZ Bank, said that considering the steep U.S. tariffs, a calibrated path, tilted towards a mildly undervalued rupee over the medium term, will help exporters. "A weaker INR can cushion the local currency earnings of an impacted Indian exporter, providing relief." https://www.reuters.com/world/india/indian-rupee-enters-2026-back-foot-after-worst-annual-drop-three-years-2025-12-31/

2025-12-31 05:06

Dec 31 (Reuters) - There will be no precious metals report on Thursday, January 1 as most markets will be closed for the New Year holiday. Reuters will resume coverage of the report on Friday, January 2. Sign up here. https://www.reuters.com/world/india/gold-set-best-year-nearly-half-century-silver-heads-largest-annual-gain-2025-12-31/