Sterling weakened on disappointing UK November GDP data, while market focus shifted to upcoming real-sector indicators and the confirmation hearing for the US Treasury Secretary nomination. The dollar exhibited mixed performance, with the euro, Swiss franc, and yen firming. Equities mostly traded higher, gold surpassed $2,700 for the first time since mid-December, and February WTI crude dipped after approaching $80.75 yesterday.

Asia Pacific Markets
The Bank of Japan's signal of a possible rate hike on January 24 and softer-than-expected US core CPI drove the yen higher, with the dollar posting its steepest loss against the yen since November. The dollar fell to JPY156.15 yesterday and declined further to JPY155.20 today, marking a new low for 2025.

European Markets
The euro extended its recovery from Monday's two-and-a-half-year low, aided by softer US core CPI data, briefly reaching $1.0350 before pulling back slightly today.
Sterling, however, faced pressure from weak UK GDP figures. Despite this, softer US CPI provided some relief, allowing sterling to recover modestly from Monday's low near $1.21.

American Markets
The dollar index extended its decline following softer core CPI data, dipping to 108.60 but holding above its 20-day moving average. Market expectations for Federal Reserve rate cuts shifted earlier, with the first cut now fully priced in for July and 37 basis points of reductions expected for the year. Key data releases today include December retail sales and the Philadelphia Fed survey, which may influence market sentiment further.