The S&P Global Composite PMI for the United States dropped to 52.7 in December, down from 53 in November. This indicates slower growth in both the services and manufacturing sectors. In other market news, analysts expect Australia’s CPI inflation to slow down in November, and silver prices have risen above $80. There’s also cautious optimism before the US employment data release, and gold is climbing back to previous highs.

Editors Picks Market Movements

Editors’ Picks show that the EUR/USD pair continues to fall below 1.1700, while GBP/USD has pulled back from recent peaks. In the cryptocurrency space, the rise of Bitcoin, Ethereum, and XRP has slowed due to increased ETF investments. There are various guides available for selecting the best brokers in 2026. These include lists of the best forex brokers and those with low spreads. Some guides focus on brokers in specific regions like MENA and Latam, as well as for particular instruments like gold. FXStreet highlights that while it provides market insights, it cannot guarantee data accuracy and advises caution when investing. Readers are encouraged to do their research before making investment choices. With the latest US Composite PMI reading showing a decrease to 52.7, we see our first clear sign of slowing economic growth. Although still in growth mode, this decline marks a shift from the stronger performance seen in the past quarter. This change prompts us to rethink our strategies as the market assesses whether this is an isolated case or the beginning of a trend.

Monitoring Economic Shifts

This slowdown follows a period of unexpected economic strength in 2025, where inflation eased to a manageable 2.8% in the last quarter, and the job market remained strong. The December jobs report showed a solid gain of 160,000 jobs, although at a slower pace. The current PMI number suggests that the effects of previous Federal Reserve rate hikes may finally be impacting the economy. The likelihood of slowing growth makes it more probable that the Federal Reserve’s next action will be a rate cut instead of an increase. Therefore, we should consider investing in interest rate futures that would benefit from lower rates later this year. Additionally, options on Treasury bond ETFs could be a smart way to take advantage of this potential shift in central bank policy. With this growing uncertainty, we can expect an increase in market volatility. During much of the second half of 2025, the VIX traded below the historical average of 19, resting around 15, making hedging relatively cheap. Now might be a good time to buy VIX call options or protective puts on broad market indices like the SPX to prepare for a possible downturn. We should also assess how this slowdown could affect various sectors. Consumer discretionary and industrial stocks are often more responsive to economic slowdowns, making put options on their respective sector ETFs a smart hedge. On the other hand, defensive sectors like utilities and healthcare may attract more interest, which could be leveraged through call options. The strong dollar, which has impacted pairs like EUR/USD and GBP/USD, may lose momentum if the market starts to price in Fed rate cuts aggressively. This indicates a need to consider options strategies that could capitalize on a reversal or stabilization in major currency pairs. The recent rise in precious metals like gold and silver above $4,500 and $80 indicates that traders are seeking safer investments, and employing options can be a cost-effective strategy to join that trend. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now