1. Global Macroeconomic Context: An Economy in Transition
United States: A Softening Labour Market Amid Persistent Inflation
The U.S. economy enters 2026 against a backdrop of a visibly weakening labour market following a pronounced slowdown at the end of last year. Employers added only 50,000 jobs in December 2025, well below expectations (consensus around +70,000), extending the subdued hiring trend observed throughout 2025. The unemployment rate edged down to 4.4%, following downward revisions to October and November figures, reflecting reduced labour force participation rather than a structural improvement in employment conditions.
This slowdown is unfolding in an environment where inflation remains insufficiently contained, despite the Federal Reserve’s rate cuts implemented during 2025. Preliminary data suggest that headline CPI inflation is likely to have accelerated in December 2025 to approximately 2.7% year-on-year, with a notable monthly increase driven by goods and energy prices.
Interpretation: While a softer labour market is easing upward wage pressures, inflation remaining above the Federal Reserve’s 2% target complicates the monetary policy outlook. The Fed appears increasingly inclined toward a pause in further rate reductions in the near term, reinforcing a data-dependent stance rather than a pre-committed easing path.
Euro Area: Inflation Under Control, Growth Remains Fragile
Eurostat’s December 2025 data confirm that annual inflation in the euro area stood at 2.0%, aligning with the European Central Bank’s target for the first time in several months and meeting market expectations.
Beneath the headline figure, core inflation (excluding energy and food) remains moderate at around 2.3%, while services inflation (often a key driver of medium-term expectations) continues to exceed the long-term target but shows signs of gradual deceleration.
Monetary policy implications: The ECB has maintained its key policy rate at 2%, emphasizing that the current inflation trajectory is consistent with its mandate. This positioning significantly reduces the likelihood of additional rate cuts in the immediate future.
Global Growth: Persistent Divergences
While the resilience of emerging economies and continued U.S. fiscal support help sustain global demand, regional divergences remain pronounced:
- United States: Softer labour market momentum, inflation still anchored above target, and a cautious monetary stance.
- Euro Area: Inflation largely contained, subdued growth, and persistent structural constraints.
- Asia: A recovery in Chinese exports, albeit at a pace that warrants caution regarding global demand for intermediate goods.
This heterogeneous landscape presents material challenges for the synchronization of monetary policies and the management of market risks across regions.
2. Financial Markets: Investors Adopt a More Cautious Stance
Equities: Heightened Selectivity and Focus on Fundamentals
In an environment of moderate global growth, equity markets have intensified sector and stock selection. Valuations are increasingly assessed not on isolated growth prospects, but on companies’ ability to generate sustainable and recurring free cash flows.
Firms with stable margins, low leverage, and robust cash generation have demonstrated greater resilience to macroeconomic fluctuations. Conversely, business models reliant on aggressive, debt-financed growth remain vulnerable to any repricing of risk premia.
Strategic angle: Preference is shifting toward quality dividend segments and defensive equities that benefit from a stable interest rate environment and strong balance sheets.
Fixed Income: A Clear Transatlantic Divergence
The slowdown in U.S. employment, combined with inflation that has yet to fully retreat, reinforces investor expectations that the Federal Reserve is firmly in a “wait-and-see” mode. U.S. markets are pricing a high probability that policy rates will remain unchanged at upcoming FOMC meetings.
In contrast, the euro area, where inflation is on target but growth remains weak, exhibits a flatter yield curve, reflecting more modest economic prospects and reduced upward pressure on long-term yields.
3. Commodities: Macro Signals Without a Clear Break
Oil: Uncertainty Over Final Demand
Oil prices continue to trade within a relatively narrow range, responding primarily to global supply expectations and rapid adjustments in demand. Indicators such as trade flows and industrial activity suggest that global demand is not accelerating sharply, despite broadly balanced long-term fundamentals.
Market positioning: A broadly sideways trend prevails, with scope for tactical opportunities around OPEC production announcements and key manufacturing activity data releases.
4. Political and Economic Risks: An Underestimated Source of Volatility
United States: Debt Ceiling Uncertainty
The political outlook remains a non-negligible variable for both bond and equity markets. Discussions surrounding the debt ceiling, scheduled for the second quarter of 2026, could generate heightened volatility should negotiations extend to the final stages.
Such fiscal uncertainty has the potential to amplify volatility premia across risk-off assets.
Europe: Economic Integration and Political Pressures
The rise of eurosceptic political forces in several member states, coupled with ongoing debates over structural reforms, continues to weigh on European growth expectations and the positioning of international investors.
Conclusion: A Pivotal Week, Without Illusion and Without Rupture
Data released by major statistical and monetary institutions at the start of 2026 confirm a critical reality: the global economy is entering neither a phase of abrupt dislocation nor a swift return to pre-crisis normalcy. Instead, it is settling into an intermediate and more demanding regime, where macroeconomic visibility remains limited but anchored by solid institutional frameworks.
In the United States, the resilience of the labour market and the gradual normalization of inflation, as documented by the Bureau of Labor Statistics and the Federal Reserve, continue to justify a cautious, data-dependent monetary approach without a predefined easing timetable. In the euro area, Eurostat indicators and ECB communications point to a more fragile disinflation path, constrained by weak growth and incomplete monetary transmission.
In energy and commodity markets, OPEC reports and Chinese customs statistics underscore that equilibrium remains heavily dependent on supply discipline and uneven Asian demand. Prices are now reflecting less the shock itself than enduring structural scarcity and persistent geopolitical constraints.
For the week ahead, the message is unequivocal: markets are no longer driven by expectations of a rapid central bank pivot, but by the internal consistency of economic trajectories. In this environment, value increasingly gravitates toward transparency, balance sheet strength, and the capacity of economic actors to adapt to a world in which stability is no longer given, but deliberately constructed.
Sources
United States
- U.S. Bureau of Labor Statistics (BLS), The Employment Situation, December 2025, official release, January 2026.
- Associated Press, Sluggish hiring closes out a frustrating year for job seekers though unemployment slips to 4.4%, January 2026.
- Reuters, U.S. consumer prices likely snapped back after being restrained by government, January 2026.
- Reuters, Fed’s Williams says monetary policy well positioned amid a favorable outlook, January 2026.
- Federal Reserve Board, FOMC Statements and Speeches, December 2025 – January 2026.
Euro Area
- Eurostat, Flash Estimate – Euro Area Inflation, December 2025, January 2026.
- European Central Bank (ECB), Harmonised Index of Consumer Prices (HICP), official database.
- Financial Times, Eurozone inflation falls to 2% in December, January 2026.
- Investing.com, Eurozone annual inflation slows to 2.0%, Eurostat data shows, January 2026.
China
- Reuters, China’s 2025 record export surge expected to slow in December, January 2026.
- Reuters, China trade data and surplus outlook, December 2025, January 2026.
- General Administration of Customs of China (GACC), Foreign Trade Data, monthly publications.
Financial Markets and Rates
- U.S. Department of the Treasury, Daily Treasury Yield Curve Rates, real-time data.
- European Central Bank, Euro Area Yield Curves, official database.
- CME Group, FedWatch Tool, implied market probabilities (derived data).
Energy and Commodities
- Organization of the Petroleum Exporting Countries (OPEC), Monthly Oil Market Report, January 2026.
- IFP Énergies nouvelles, Oil Markets Dashboard, January 2026.
Macroeconomic and Market Analysis
- Reuters, global macroeconomic analyses, January 2026.
- Financial Times, economic and financial analyses, January 2026.
- Wall Street Journal, U.S. Economy & Markets, January 2026.
Political and Fiscal Risks
- U.S. Department of the Treasury, official communications on the debt ceiling.
- European Commission, legislative and economic agendas.
- National parliaments of EU Member States, electoral and legislative calendars.
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