The US jobs report will be the main focus next week, along with the ISM indices and consumer sentiment reports. The December report comes out on Friday. We expect nonfarm payrolls to rise by 50,000, unemployment to drop to 4.5%, and hourly earnings to grow by 0.3%. On Wednesday, we’ll see the ADP and JOLTS reports. Michigan’s consumer survey will be available on Friday, and Q3 unit labor costs will be released on Thursday. In Europe, everyone will be watching the preliminary December Consumer Price Index (CPI) data for the Eurozone. Germany and France will share their numbers on Tuesday, followed by a Eurozone report on Wednesday. Switzerland, Sweden, and Norway will also release inflation figures. Germany has more data coming out, including factory orders on Thursday and industrial production and trade balance on Friday.

Economic Developments In Asia

In Asia, China will release its CPI and Producer Price Index (PPI) reports on Friday. Japan’s wage data comes out on Wednesday. Economic activities this week are diverse and span multiple regions, driven by different sectors’ data. Looking ahead to next week’s US jobs report for December 2025, this is the first major economic data release of the new year. We’re anticipating an increase in nonfarm payrolls of just 50,000, a noticeable drop from the 64,000 in November 2025. This figure is far below the monthly average of about 180,000 jobs typically seen before the pandemic, indicating a possibly slowing economy. The situation becomes more complicated with wages expected to increase by 0.3%, while the unemployment rate is predicted to fall to 4.5%. This mix of fewer jobs alongside rising pay raises questions about the Federal Reserve’s next steps, suggesting that volatility options on major indices might be undervalued. This conflicting data makes it tough for the Fed to decide whether to stimulate a slowing economy or combat wage-driven inflation. In Europe, we are paying close attention to the preliminary inflation numbers for Germany, France, and the broader Eurozone. If the CPI data is hotter than expected—especially after staying above the European Central Bank’s 2% target for much of 2025—it could lead to a more aggressive monetary stance. This might strengthen the Euro, making call options on the EUR/USD pair an interesting tactical move for the upcoming weeks.

Key Global Economic Data

China’s inflation and producer price data, set for release on Friday, is also crucial for global market sentiment. It’s important to note that China’s producer prices have been in deflation for over a year, indicating ongoing weak demand in factories. Another disappointing report could impact commodity futures, especially for industrial metals like copper. The market is starting the year peacefully, but these upcoming data points could shift that quickly. The CBOE Volatility Index (VIX) often rises before major economic reports, historically spiking from the mid-teens to above 20 with surprising job numbers. This presents an opportunity to buy inexpensive, short-dated VIX call options as a hedge against possible market overreactions. For currency traders, the potential gap between a weak US jobs report and strong European inflation will be a key event. Such a scenario could disrupt the recent stability of the US Dollar, encouraging strategies like bull call spreads on the EUR/USD. This method allows traders to benefit from potential Euro gains while managing and limiting risk. Create your live VT Markets account and start trading now.

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