Equity markets closed out November, charging back from losses incurred earlier in the month, due to AI bubble concerns. Risk appetite surged, with further speculation that the Fed will cut rates at their last meeting for the year, on December 9/10th. The positive vibe in the markets is likely to continue, but watch the US PCE Inflation indicator, released this coming week. The PCE is heavily utilised by the Federal Reserve, to gauge inflation and if this is hot, then the Fed will likely cancel any planned rate cuts the following week. This would reverse the equity rally and boost sagging bond yields. The EUR will open the week trading around 1.1600, while the GBP consolidates above 1.3200.The NZD has been the star performer over the last week, triggered by hawkish commentary from the RBNZ. The RBNZ cut rates as expected last week but indicated that will be the end of the rate cutting cycle and rises may be coming in 2026. This propelled the NZD way above 0.5700, enhanced by some stronger than expected and positive economic data. The Government will be hoping they have turned the economic corner, but they are not out of the woods yet. The AUD reached 0.6550, enjoying the improved global risk sentiment. There is a lot of local Australian data due out this week, including PMI and Q3 GDP growth numbers.
