International News 30 December 2025
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Asian Currencies Mixed as Won Strengthens, Baht Weakens Toward Year-End
Asian currencies traded mixed on Monday (Dec 29, 2025), with the Thai baht weakening while the South Korean won strengthened against the US dollar, according to Reuters data. The won led regional gains, supported by capital inflows and relatively stable domestic economic prospects, while the baht came under pressure due to domestic factors and broader year-end headwinds facing Asian currencies. Other currencies showed modest moves, with the Japanese yen, Singapore dollar, Taiwan dollar, and Chinese yuan fluctuating in narrow ranges, reflecting cautious market positioning ahead of the year-end close. On a year-to-date basis, performance across the region has diverged sharply. The Singapore dollar, Taiwan dollar, and South Korean won have posted solid gains against the dollar, while the baht, Malaysian ringgit, Indonesian rupiah, and Chinese yuan have weakened notably. Investors remain focused on global economic developments, interest rate expectations, and geopolitical risks, all of which are expected to continue shaping currency movements in Asia as markets head into 2026.
Asian Stocks Hit Six-Week High as Rate-Cut Bets Weigh on Dollar and Fuel Metals Rally
Asian equities climbed to a six-week high on Monday (Dec 29, 2025), while the US dollar hovered near a nearly three-month low, as markets increasingly priced in Federal Reserve interest rate cuts next year. The weaker dollar and lower-rate expectations also triggered sharp moves in precious metals, with silver briefly surging above US$80 per ounce for the first time before retreating in volatile trading. Gold slipped nearly 1% on the day but has repeatedly hit record highs this year, supported by dollar weakness, safe-haven demand, and expectations of easier monetary policy amid ongoing geopolitical and fiscal uncertainty. The MSCI Asia-Pacific index rose 0,27% to its highest level since early October, capping a strong year in which it gained over 25%, largely driven by AI-related technology stocks. South Korea’s Kospi jumped 1,5% and is on track for its strongest annual performance since 1999, while Taiwan equities hit fresh records and Japan’s Nikkei edged lower. In currency markets, the yen strengthened slightly after Bank of Japan signals hinted at the need for further rate hikes, though it remains near multi-month lows. Investors are now turning their focus to the release of the latest Fed meeting minutes and upcoming US labor market data for clearer signals on the timing and pace of policy easing in 2026.
China’s Lithium Battery Demand Set to Drop Sharply in Early 2026
China’s lithium battery demand is expected to fall sharply in early 2026 as domestic electric vehicle (EV) sales weaken and export growth slows. Cui Dongshu, Secretary General of the China Passenger Car Association (CPCA), warned that demand for new-energy vehicle batteries could plunge from late 2025 into early 2026, urging battery makers to scale back production and prepare for market volatility. He estimates that China’s green passenger vehicle sales may decline by at least 30% in early 2026 compared with Q4 2025, largely due to the expiration of purchase tax incentives and subsidies, alongside a similar pullback in commercial EV demand after front-loaded buying this year. The downturn poses risks for major battery producers such as CATL and EVE Energy, especially as weaker domestic demand is unlikely to be offset by exports. China’s lithium battery exports to the European Union grew just 4% in 2025, while shipments to the United States fell 9.5% year-on-year. According to Cui, even the surge in US energy storage demand linked to the AI boom has not significantly lifted Chinese battery exports. Adding to the pressure, analysts warn that tighter US policies restricting tax incentives for projects involving certain foreign entities could further weigh on China’s battery manufacturers going into 2026.