Weekly Investment Observation (November 30, 2025)

Period　November 23–29, 2025

  1. Key Economic Indicators

  • US Conference Board Consumer Confidence (Nov): 88.7 vs around 93.4 expected / Fourth consecutive decline on concerns about inflation and jobs, pointing to downside risks for consumption and a higher probability of recession.

  • Tokyo Core CPI (Nov): +2.8% y/y vs +2.7% expected / Inflation in the capital remains above the BoJ’s 2% target, keeping expectations alive for gradual policy normalisation and potential medium-term support for the yen.

  • Japan Monthly Economic Report (Nov): Overall view kept at “moderate recovery,” with private consumption “picking up” for the third month / Together with the large supplementary budget, this supports domestic demand but raises questions over long-term fiscal sustainability.

  • ECB October Meeting Account: Policy rate left on hold, with minutes stressing two-sided inflation risks and the value of a wait-and-see stance / This limits near-term easing expectations and anchors euro-area yields at relatively high levels.

  • US Data Release Disruptions: Key October indicators such as CPI, payrolls and PCE were cancelled or delayed due to the shutdown / The Fed faces the next meeting with unusually large data gaps, increasing uncertainty around its policy decisions.

  1. Major Economic & Geopolitical News

  • Global Markets: In thin US Thanksgiving trading, renewed expectations of early rate cuts helped equities stay resilient while long-term yields remained elevated / High-valuation growth and AI-related stocks show signs of fatigue, with dip-buying offset by profit-taking.

  • Japan’s Fiscal–Monetary Mix: A large supplementary budget aimed at offsetting real-income erosion and supporting growth moves forward, underpinning the recovery / At the same time, concerns over increased JGB issuance and a gradual BoJ normalisation raise the risk of higher domestic yields.

  • ECB Policy Stance: Communication emphasises that it is too early to talk about rate cuts / A prolonged period of high rates could tighten financial conditions for highly indebted sovereigns and emerging Europe through higher funding costs.

  • China Property and Credit Stress: Sharp declines in major developers’ bonds and weak new lending and TSF data highlight ongoing real estate strains and subdued credit demand / This weighs on Asian credit markets and caps potential upside for global commodities via softer Chinese demand.

  • Middle East and Ukraine: Tensions in Gaza remain elevated despite ceasefire efforts, and uncertainty persists around ceasefire frameworks and security guarantees in Ukraine / Persistent geopolitical risk supports safe-haven demand for gold and defence-related assets and maintains a risk premium in energy markets.

  1. Investment Stance

Equities: Moderately cautious
Weakening US consumer sentiment, ongoing China property stress, “higher-for-longer” rates in Europe and data uncertainty argue for patience on broad indices. Maintain selective exposure to quality and AI leaders mainly on pullbacks rather than chasing rallies.

Bonds: Moderately bullish
Slowing momentum and rising expectations for future rate cuts improve the risk–reward in core sovereign duration. However, large fiscal deficits and elevated rate volatility argue for a balanced focus on short- to intermediate-term maturities instead of a heavy shift into the ultra-long end.

Commodities: Moderately bullish
Gold and other precious metals remain attractive as portfolio hedges amid geopolitical risk and expectations that real yields are near a peak. Energy and industrial metals are likely to trade in ranges given weak Chinese demand, favouring tactical rather than strongly directional positions.

FX: Neutral
With the Fed constrained by missing data and the ECB and BoJ normalising at different speeds, the dollar lacks a clear directional bias. USD/JPY is likely to remain in a broad range as expectations of BoJ normalisation offset the still-sizeable US yield premium.

This week’s personal note

I will closely watch how the Fed communicates around potential rate cuts in December. With markets seemingly pricing in a December cut and equities showing bubble-like characteristics, I plan to maintain a cautious trading stance.

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