As 2025 enters its final month, trading activity has not slowed; instead, it has intensified sharply due to the overlap of multiple major events. On one side, markets are trying to gauge how global central banks are balancing growth and inflation; on the other, they are closely watching the technological showdown and monetization capabilities of leading AI companies. Any upside surprise on either front could trigger significant cross-asset volatility.

The Fed’s December Rate Decision

Time: 3:00 a.m. Beijing time, Thursday, 11 December – rate decision; 3:30 a.m. – Chair Powell’s press conference

Markets have already priced in with near-100% certainty that the Fed will cut rates by 25 basis points at this meeting. As a result, the cut itself is merely “the other shoe dropping”; the real storm lies in the signals about the future policy path conveyed by the meeting.

There are three core focal points this time.

1. The latest Summary of Economic Projections (SEP) and the “dot plot.”
   Markets will comb through the SEP line by line to see whether the Fed’s forecasts for 2026 GDP, inflation, and unemployment turn more pessimistic, and will pay extremely close attention to whether the dots imply two cuts next year, or possibly three. This will determine whether this cut is a “one-off adjustment” or confirmation of a broader easing cycle.

2. Changes in the wording of the policy statement.
   In particular, whether the Fed removes the word “restrictive” when describing its policy stance. Doing so would be seen as a key marker of a dovish shift.

3. The tone of Powell’s press conference.
   How he explains the decision to cut (as a precautionary move against slowing growth, or as a sign of confidence that inflation is back on target), and any “hawkish guardrails” he sets around future policy, will all trigger sharp market swings. In addition, the FOMC’s internal voting pattern is also worth watching.

If the meeting as a whole delivers a “dovish cut” (i.e. hinting at the possibility of further easing), U.S. equities—especially rate-sensitive growth and tech names—are likely to get another leg of support, while the U.S. dollar may weaken. Conversely, if the Fed stresses a “hawkish cut” (i.e. framing this move as a one-off with a pause to follow), expectations may be disappointed, potentially leading to “sell-the-news” profit-taking and a rebound in the dollar.

A Global “Super Central Bank Week”

Hot on the Fed’s heels, a number of central banks—including those of Canada, Australia, Switzerland and Brazil—will announce their rate decisions.

The circumstances and choices facing each central bank will be markedly different, highlighting the divergence in global economic cycles. The Bank of Canada is very likely to follow the Fed in cutting rates, but concerns over domestic housing bubbles and inflation could make its stance more cautious. The Reserve Bank of Australia may remain on hold, given that services inflation there is more sticky. The Swiss National Bank is known for decisions that often surprise; in an environment of a strong franc and low inflation, any unexpected move could stir up the FX market.

The most special case is the Bank of Japan. Although its policy meeting is scheduled for next week, Governor Kazuo Ueda’s speech in London this week is crucial. He has recently sent hawkish signals; any clear hints of a timetable for “exiting negative rates” or “adjusting yield curve control (YCC)” could trigger a surge in the yen and a chain reaction across global bond markets.

Traders will compare how each central bank’s pace differs from that of the Fed, and this relative stance will directly drive moves in cross-currency pairs. If several central banks adopt a stance more dovish than the Fed’s, the U.S. dollar could be pushed stronger by default. The BoJ Governor’s speech will be one of the biggest “risk events” in FX this week and may set the tone for the yen and broader Asian market sentiment.

BoJ Governor’s Speech: Countdown to the World’s “Last Negative Rate”

This event is the best window into the future course of the world’s “outlier” in monetary policy. Japan is currently the only major economy still maintaining a negative interest rate policy. Ueda’s recent remarks have shifted from ambiguous to clearer, as he has begun to openly discuss “exit” strategies. This speech in London, delivered in front of global investors, carries far more weight than a routine appearance.

Markets will parse his words one by one, looking for clues on the specific conditions for a rate hike, potential adjustments to YCC, or a possible timetable for fully exiting negative rates (early 2026—or even sooner?). Any move by the BoJ toward policy normalization will trigger large-scale unwinding of global carry trades that borrow yen to invest in high-yielding assets, sending funds back to Japan.

This is one of the events with the greatest potential for volatility this week. Hawkish signals would likely lead to:

1. a rapid appreciation of the yen;
2. a spike in Japanese government bond yields, which could in turn lift global bond yields;
3. selling pressure on emerging-market assets that rely heavily on carry flows.

Dovish comments would temporarily calm market nerves, but would not alter the broader trend. Any pullback in the yen could simply become another opportunity to build long positions.

OpenAI “Urgently” Releases GPT-5.2

Time: Expected on Tuesday (9 December)

OpenAI has brought forward the release of its GPT-5.2 model, originally scheduled for the end of the month, to this week. Behind this “urgent move” lies intense competition with Google’s Gemini 3—the industry has effectively moved into a “red alert” state.

This release is far from just a routine upgrade. First, it marks the shift in AI giants’ rivalry from “technical stockpiling” to a white-hot phase of “market offense and defense.” Launching ahead of schedule is aimed at capturing mindshare among the public and developers, and at maintaining OpenAI’s dominance in its ecosystem. Second, the focus of the release may shift away from simply chasing parameter size, toward improving inference speed, cutting API costs, and enhancing long-context stability—practical metrics key to strengthening its commercial monetization. Finally, this goes to the heart of OpenAI’s survival: its plan to raise up to hundreds of billions of dollars in funding requires a sustained narrative of technological leadership. Once its market position wobbles, its sky-high valuation will face a severe test.

This event directly benefits Microsoft (MSFT), which is deeply tied into the OpenAI ecosystem. For the broader AI software and cloud computing space, it is an important sentiment test. If GPT-5.2 performs better than expected, it will boost confidence in AI adoption and users’ willingness to pay. If reception is lukewarm, it could spark worries about “over-competition” in the sector and doubts about profit outlooks, leading to a correction in the group.

Oracle and Broadcom Earnings

• Oracle earnings: Morning of Thursday, 11 December (Beijing time)

• Broadcom earnings: Morning of Friday, 12 December (Beijing time)

Oracle’s share price has pulled back significantly from recent highs over the past month, as the market frets over its aggressive capital expenditures. The key focuses for the earnings report are:

1. OCI (Oracle Cloud Infrastructure) growth: Can it maintain the 54% high growth seen last quarter?
2. Funding gap: To fulfill AI orders, it will need to raise nearly 100 billion USD over the coming years to build data centers—how management plans to raise this capital (debt vs. equity).
3. Progress of its OpenAI partnership: Specific cooperation details and outlook for revenue contribution.

The earnings report is a double-edged sword. Strong OCI growth could fuel a rebound in the share price, but any hints of equity-diluting financing will be viewed as a major negative.

Broadcom’s share price is at historical highs and has already fully priced in AI tailwinds, leaving it extremely sensitive to guidance. The key points of interest are:

1. Quantitative guidance for AI business: How its “100-billion-plus” collaboration with OpenAI will be recognized in revenue over time.
2. FY26 outlook: Whether it can once again raise its forecasts to confirm that the AI demand cycle is still climbing.
3. Earnings quality: Whether its AI ASIC (custom chips) and high-speed networking businesses drive simultaneous expansion of gross and operating margins.

As a “weathervane” for AI chips and infrastructure, its guidance will directly shape sentiment across the semiconductor sector. Better-than-expected guidance could push the group to new highs; otherwise, it may trigger broad profit-taking in high-valuation names.