The United States has threatened to impose retaliatory tariffs on major European firms if Brussels continues with its tax regulations on American tech giants. The dispute centers on the EU’s policies regarding companies such as Google, Apple, Meta, X, and Amazon.

According to Bloomberg, the US has expressed its willingness to employ all available tools to counter these measures, which may include imposing tariffs and restrictions on foreign services. European companies such as Siemens, Spotify, DHL, and SAP could be at risk as Washington deems the European measures “unjustifiable” and “discriminatory.”

The conflict has intensified after the European Commission imposed a fine of $120 million on the X social media platform. French Foreign Minister Jean-Noel Barrot characterized this move as “just the beginning” and commended the European Commission for its “tough measures.” This escalation highlights the growing rift between the US and the EU over the regulation of digital platforms and tax policies.

US Treasury Secretary Scott Bessent anticipates a significant decrease in inflation during the first six months of 2026. During his appearance on Fox Business, he linked this expected relief to the closure of the US borders and a decline in rental prices. Bessent projected 3.5% GDP growth for 2025 and predicted that 2026 could be a “bountiful” year, provided the government remains operational.

The secretary forecasted tax returns in the range of $100 billion to $150 billion for the first quarter of 2026, which would amount to approximately $1,000 to $2,000 per household. He attributed current pressures to what he referred to as “Biden’s inflation” but remained optimistic about 2026. Bessent also mentioned that a Supreme Court decision on tariffs is expected in early January.

Regarding personnel decisions at the Federal Reserve, Bessent indicated that US President Donald Trump would announce a new head in early January. The official referred to Kevin Warsh and Kevin Hassett as “highly qualified” candidates. He also voiced concerns that the Federal Reserve has become an “unelected institution that lost trust.”

Regarding international matters, the secretary stated that China has adhered to established agreements. At the same time, he emphasized that maintaining a $1 trillion trade surplus would be unsustainable for the country. Bessent also pledged to reduce the budget deficit by several hundred billion dollars in the current year.

China’s economy continues to face pressure from both weak global and domestic demand. According to the National Bureau of Statistics of China, industrial production grew by only 4.8% year-on-year in November, marking the slowest pace in 15 months and falling short of market expectations. This lag is particularly pronounced in the manufacturing and energy sectors, though mining has shown relatively stronger performance.

The consumer sector is facing an even more pressing challenge. Despite ongoing demand support programs, retail sales increased by just 1.3% year-on-year, the lowest level since late 2022. This weakness stems from financial uncertainty and declining household incomes. The automotive market has weakened further, with sales growth plummeting to 3.4%, a significant drop from October levels, reflecting reduced incentives and consumer caution.

Investment activity is critically low, with fixed asset investment decreasing by 2.6% in the first 11 months of the year. New lending volumes remain modest due to lackluster demand for borrowing and limited impact from government stimulus measures. Although unemployment stands at a historical low of 5.1%, this has not resulted in robust income growth. The economic recovery remains uneven and largely hinges on the effectiveness of additional stimulus measures.

Elon Musk has set a historic milestone by becoming the first individual to surpass a net worth of $600 billion. According to Forbes, the entrepreneur’s wealth has reached an astonishing $677 billion, fueled largely by a recent revaluation of SpaceX during a funding round.

In early December, Musk’s company announced a stock buyback plan, raising its valuation from $400 billion in August to an impressive $800 billion. This surge led to a rise of $168 billion in the entrepreneur’s personal fortune. According to Forbes, Musk is the first person to reach a net worth of $600 billion, noting that no one else in history has ever held a fortune of $500 billion.

The previous record set by Musk was achieved in October when he became the first person to reach a net worth of $500 billion. His rapid wealth increase underscores the skyrocketing value of shares in his companies, Tesla and SpaceX, both of which are currently experiencing significant growth.

The US dollar continues to assert its supremacy in global currency markets, defying predictions of its weakness. Despite a staggering national debt of $38 trillion and international initiatives aimed at reducing reliance on the dollar, it remains irreplaceable, according to a report by Yardeni Research. Although the dollar has fallen by 12% against the euro this year, analysts view this as a correction rather than the start of a sustained decline.

This enduring dominance can be attributed to the structural weaknesses of its rivals. The euro, accounting for only 20% of global reserves, suffers from fragmentation. Twenty countries in the euro area have refused to establish a unified fiscal union, leaving Europe without a viable alternative to US Treasury securities. The Japanese yen hovers precariously close to a recession, further constrained by Prime Minister Fumio Kishida’s strategy to weaken the currency. The British pound has yet to recover fully from the repercussions of Brexit and the ongoing political turmoil. Meanwhile, the Chinese yuan remains only partially convertible, hampered by the lack of independence of the People's Bank of China.

Yardeni describes the situation as a “beauty contest,” in which the winner is not necessarily the most attractive, but rather, the one with the fewest flaws. The US dollar constitutes 60% of central bank reserves and is still the primary currency for international trade and corporate borrowing. Despite inherent risks, including inflation at 3%, a potential downgrade from AAA status, and uncertainties surrounding Trump’s trade policies, carry trades are wrapping up the year in favor of dollar strength. Global efforts towards de-dollarization have seen limited success, as moving away from the greenback would prove too costly and disruptive.

China’s economy continued to lose momentum in the final quarter of 2025, reinforcing the case for more extensive stimulus measures in the upcoming year, analysts at ING said in a report released on Monday.

The commentary follows the release of data showing that growth in industrial production and retail sales in November fell short of expectations. In addition, investments in fixed assets declined more sharply than anticipated for the second consecutive month, an alarming signal that businesses are beginning to tighten their belts.

According to ING, weaker retail sales can largely be attributed to the delayed effects of subsidies and trade-in programs launched by Beijing at the end of 2024. While these measures initially stimulated consumption, their impact quickly faded, requiring an expansion of the programs to sustain demand.

Industrial production remains one of the few bright spots, with steady external demand expected to continue partially offsetting domestic weaknesses. However, analysts warn that the struggling property market and sluggish consumer spending are likely to be significant drags on the economy in 2026.

The ING analysts cautioned that the more complex challenges for China would emerge starting next year and continue into the future. They highlighted that the most pressing concern for the country is the erosion of trust, which poses a risk of becoming a chronic issue.

New data comes on the heels of disappointing inflation statistics released last week, showing that consumer inflation remains subdued and that producer inflation contracted for the 38th consecutive month in November.

According to ING, policymakers have considerable work ahead if domestic demand is to become the key driver of growth in 2026, as planned.

Recent statements from the Politburo and the Central Economic Work Conference reaffirm that stimulating domestic demand remains a priority. However, few concrete measures have been announced, aside from promises to enhance fiscal support.

ING suggests that a GDP growth target of around 5% for 2025 is still achievable. Nevertheless, amid weakening domestic demand, the risk of a downturn is increasing, both in the short and long term.

Standard Chartered has sharply revised its Bitcoin forecasts, cutting its 2025 year-end target from $200,000 to $100,000. The long-term projection of $500,000 has also been postponed by two years, moving from 2028 to 2030. Chief Analyst Geoffrey Kendrick acknowledged that the initial short-term targets were inaccurate, attributing the revision to market dynamics following a 36% drop from October's peak of $126,000 to $80,500 at the end of November.

Kendrick emphasized that such declines are within the normal range compared to previous cycles since the launch of spot ETFs in the United States. The updated forecast anticipates a gradual increase, with projections of $100,000 in 2025, $150,000 in 2026, $225,000 in 2027, $300,000 in 2028, $400,000 in 2029, and $500,000 in 2030.

The analyst explained that the slowdown stems from a shift in demand sources. Initially, growth was fueled by inflows into ETFs and purchases from companies like MicroStrategy, which operate as "digital asset treasuries." Now, this phase is considered complete, which necessitates reevaluating price expectations.

Betting platforms in the US are hesitant to make predictions about the Fed’s interest rates for 2026 under conditions of "stalled progress" towards 2% inflation, uneven but steady economic growth, and initial signs of a softening labor market. This is stated in a new forecast by HSBC, which warns that the coming year may pose a challenge to investor expectations.

After a strong 2025 for Treasury bonds, the bank believes that the Federal Reserve's ability to meet market hopes for sharp rate cuts will be limited by both structural and cyclical factors. HSBC anticipates a yield of 4.30% on 10-year Treasury bonds by the end of 2026—higher than the Bloomberg consensus—and a slight increase to 4.40% by the end of 2027. The bank maintains a neutral position on duration.

HSBC considers several scenarios. If inflation unexpectedly accelerates, yields could test the 5% area, especially if questions arise about the independence of monetary policy. Conversely, a softer economic cycle could provoke a "significant bullish steepening of the yield curve." As a result, the bank views the risk balance as "asymmetric," skewed towards further increases. Experts see positioning in the "belly" of the curve as the most attractive, where structural risks are lower, and yields remain acceptable.

HSBC also notes that potential personnel changes in the rate-setting committee, including the expected departure of Jerome Powell in mid-2026, will add uncertainty to the FOMC’s agenda. Regarding the Federal Reserve's operations, the bank foresees the start of "net asset purchases" in Treasury bills as early as the first quarter of 2026 to alleviate funding pressures as liabilities outside of reserves grow.

On the supply side, HSBC suggests that the sizes of coupon auctions will remain stable in the first half of 2026, but an expansion of issuances is likely to appear on the horizon, most probably in the fourth quarter, considering the increasing budget deficits. The bank also points out that swap spreads do not fully reflect these risks, creating the possibility that long-term Treasury bonds may show weak performance relative to swaps in the coming months.

Last month, the European Central Bank stated that China has been flooding European markets with excess goods at dumping prices for several years, harming EU manufacturers. These remarks come amid mounting pressure on European policymakers to address the sharp increase in imports from China.

In the face of high US tariffs and a protracted slump in domestic demand, Chinese companies are actively seeking buyers beyond their home market. However, the ECB estimates that the influx of cheap Chinese goods into Europe is not solely the result of American tariffs. After all, this trend began in 2021 when the Chinese real estate crisis first affected consumption in the world’s second-largest economy.

Government investments aimed at promoting growth have led to an oversupply of production capacity and price wars in the domestic market, making exporting a much more appealing option. To maintain competitiveness abroad, Chinese firms are slashing short-term costs, reducing margins, and sometimes even selling at a loss.

In a recent analysis, Goldman Sachs noted that intensified Chinese competition presents "ambiguous consequences" for ECB policy. An increase in imports could ease price pressures, but the overall impact on inflation will depend on the response of domestic demand and whether new price risks emerge. Analysts assert that the central bank has limited tools to react if inflation expectations remain stable.

Historical research indicates that the ECB has generally preferred to maintain its policy course unchanged when declines in domestic inflation coincided with accelerated growth in other regions. Goldman anticipates that interest rates will remain unchanged "for the foreseeable future," although the regulator will continue to closely monitor labor market conditions, wage dynamics, and core inflation.

At the same time, analysts warn that the risks to the scenario of stable rates lean toward a potential resumption of rate cuts next year, especially if external shocks continue to amplify competition while domestic activity remains sluggish.

Fitch Ratings forecasts that the sovereign ratings of the US and Canada will remain neutral in 2026. This assessment is attributed to weak economic growth, despite accommodative monetary and fiscal policies in both countries.

The US economy will receive support from the Federal Reserve's interest rate cuts, tax breaks under the One Big Beautiful Bill Act, and rising investments in artificial intelligence. These factors are expected to bolster consumption and investment, allowing the American economy to avoid a recession, although GDP rates will remain modest.

Canada, according to Fitch’s forecasts, will experience moderate improvement due to aggravating trade uncertainty and soft fiscal policies. The country is expected to maintain economic resilience but also does not anticipate accelerating growth. For both countries, the key factors will be the monetary policies of central banks, budgetary support measures, and advancements in high technologies. 

China's Premier Li Qiang affirms that US President Donald Trump is to blame for the collapse in the global trading system. According to Li Qiang, Trump's hefty import tariffs have accelerated the fragmentation of the global economy and splintered international supply chains. Though the IMF had warned of this threat long before Trump took office, his customs policy has turned risk into reality.

Li Qiang highlighted the urgent need for measures to address this issue. Only open and mutually beneficial cooperation between countries can ensure global economic growth, which is stalling due to a considerable slowdown in demand. The regionalization of trade is damaging to the global system.

FedEx CEO Raj Subramaniam predicts a radical transformation of global logistics into a regional transportation system. The adaptation of industry to these new realities will require significant time and resources.

Eric Trump has asserted that Bitcoin is becoming increasingly attractive to long-term investors rather than to short-term traders. The son of the US president pointed out that major financial players, including sovereign wealth funds, family offices, and global institutions, are gradually increasing their investments in cryptocurrency as they seek reliable ways to preserve their assets.

Trump highlighted three key trends: the withdrawal of funds from exchanges, the influx into regulated investment products, and the increasing dominance of long-term holders. These movements indicate a recognition of Bitcoin as a macro asset and reflect investor confidence in its future prospects.

When comparing cryptocurrency to real estate, Eric Trump highlighted the advantages of Bitcoin. Property values are heavily influenced by local markets, borrowing costs, and maintenance expenses. In contrast, Bitcoin is traded globally, responds to overarching financial conditions, and benefits from scarcity and increasing popularity, which creates a more favorable environment for long-term accumulation.

French President Emmanuel Macron has issued an ultimatum to Beijing, threatening coordinated punitive tariffs similar to those imposed by the United States. France demands that China address the trade imbalance by the end of 2026. Macron believes that China must ease restrictions on imports and adopt a policy of mutual concessions.

French officials accuse China of protectionism, particularly regarding its control over the export of rare earth metals. Analysts interpret Macron’s statements as public pressure on Beijing following unsuccessful private diplomatic engagements. In early November, it was revealed that the EU had made little progress in mitigating China’s control over rare earth elements, posing challenges to Europe’s quest for economic independence.

The threat of imposing tariffs highlights the growing tension in economic relations between the EU and China and signals Europe’s intent to leverage US-style trade policy tools to safeguard its interests.

China reported a significantly larger-than-expected trade surplus in November, driven by a sharp rebound in exports and moderate growth in imports. According to official data, the surplus reached $111.68 billion—considerably higher than the consensus forecast of $100.20 billion and above October's level of $90.07 billion.

Exports surged by 5.9% year-on-year, fully offsetting the 1.1% decline in October and surpassing analysts’ expectations of just a 3.8% increase. In contrast, imports rose by only 1.9%, way below the forecast of 3%, highlighting that domestic demand remains weak and is clearly responding more slowly to macroeconomic stimuli.

The robust exports largely reflect improved global trading conditions and a recent tariff truce with the United States, allowing Chinese exporters to regain some of their lost market share overseas. This strong surplus provides additional support for China’s economic growth in the short term. However, the sluggish imports signal that challenges related to domestic consumption and investment remain unresolved and could limit the sustainability of the recovery if the external environment becomes less favorable again.