The US Federal Reserve and the ECB continue to ease monetary policy. On December 18, the US Fed cut the federal funds rate to 4.25 – 4.50% from 4.50 – 4.75%, while the ECB cut three key interest rates by 25 basis points at its December meeting. The Bank of England left the bank rate unchanged at 4.75% on December 19. US CPI in December increased to 2.90% year-on-year from 2.70% in November.

On December 19, the People's Bank of China kept the one-year loan prime rate at 3.10%. Due to the depreciation of the yuan, the bank's policy may be less aggressive. The Central Bank of Brazil raised the SELIC rate by 100 basis points to 12.25% in response to high inflation, and the Bank of Mexico cut the overnight rate to 10.00%.

The US retail sales in December declined to 3.90% year-on-year from 4.10% in November, while in China, they rose to 3.70% due to strong growth in online sales.

The US industrial production increased to 0.50% year-on-year. In China, industrial production rose to 6.20%, mainly due to growth in the machinery and high-tech sectors.

The US unemployment rate unexpectedly fell to 4.10% from 4.20%. The economy added 256,000 jobs over the month, of which 46,000 were in health care, 43,000 in retail trade, and 33,000 in government agencies.

The US Treasury yield curve shifted upward in December, reflecting inflation risks. The 10-year Treasury yield rose from 4.18% to 4.58%, the 5-year yield rose from 4.06% to 4.39%, and the 2-year yield rose from 4.16% to 4.25%.

The dollar index (DXY) rose to 108.45 by the end of December from 105.78 at the end of November, reaching one of its highest levels in two years. Among the reasons for the strong gains were expectations of fiscal policy easing, including tax cuts and easier business regulation.