Reddit has filed a legal challenge with Australia’s High Court seeking to overturn the country’s newly implemented ban on social media access for users under 16, arguing that the measure infringes on free political expression and raises significant privacy concerns.

The case makes Reddit the second party to contest what is considered the world’s first legally enforced minimum age requirement for social media platforms.

Platform says law restricts political communication

In a filing signed by its lawyers, Perry Herzfeld and Jackson Wherrett, the US-listed company said the law is “invalid on the ground that it infringes the implied freedom of political communication.”

The application argues that barring under-16 users burdens political discourse, noting that those young citizens will soon become voters whose political views are shaped by conversations they engage in well before turning 18.

“Australian citizens under the age of 16 will, within years if not months, become electors,” Reddit said in its 12-page filing.

“The choices to be made by those citizens will be informed by political communication in which they engage prior to the age of 18.”

Reddit further warned that the ban limits political discussions not only for younger users but also for adults who rely on understanding the perspectives of emerging voters, including teachers and parents.

Australia enforces ban as platforms raise concerns

Australia’s ban took effect on December 10 and applies to 10 major platforms, including Instagram, YouTube, TikTok, Snapchat, X, and Reddit.

The law requires companies to take “reasonable steps” to prevent underage users from accessing their services, using verification tools such as facial age estimation, inference from online behavior, uploaded IDs, or linked financial information.

Companies that fail to comply face fines of up to A$49.5 million (US$32.98 million).

While Reddit and other platforms campaigned for more than a year against the measure, all ultimately agreed to comply.

The Australian government has said it is prepared to fight legal challenges to the law, and Communications Minister Anika Wells reiterated that stance, saying the government would “stand firm to protect young Australians from experiencing harm on social media.”

A previous challenge was filed last month by two teenagers backed by a libertarian state lawmaker.

That case is scheduled for a February hearing. A Reuters report, citing a person familiar with Reddit’s position, states that the company has no plans to join other challengers.

Reddit argues platform differs from traditional social networks

Reddit’s application also argues that it should be exempt from the law’s provisions, saying it operates as a community discussion forum rather than a traditional social network.

The company noted that it does not import contact lists or encourage friend-based connections and that much of its content is publicly accessible without an account.

The filing adds that underage users may actually be safer with accounts because they can be protected through moderation tools and content filters—settings unavailable if they are barred altogether.

The platform emphasized that its challenge is not an attempt to preserve young users for commercial reasons.

“There are more targeted, privacy-preserving measures to protect young people online without resorting to blanket bans,” Reddit said in a statement accompanying its court filing.

The High Court challenge adds new pressure to Australia’s efforts to regulate online safety, setting the stage for a broader debate over the balance between child protection, privacy, and political expression.

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Sumitomo Corp. plans to sharply expand its presence in India’s fast-growing renewable energy sector, doubling its initial investment commitment to a total of ¥200 billion ($1.28 billion) as demand for clean electricity surges among industrial users.

The Japanese trading house will deploy the funds through its joint venture with Indian startup Ampin Energy Transition.

Joint venture targets 2 GW of capacity by 2027–28

The expanded investment will support the development of more than 2 gigawatts of renewable power capacity by fiscal 2027, or by March 2028 as stated separately by a Sumitomo spokesperson.

The projects span solar and wind installations across more than 10 Indian states, with solar operations already underway in Haryana and Karnataka.

Financial institutions are expected to participate in the funding structure, complementing the equity held through the joint venture.

Sumitomo owns 49% of AMPIN C&I Power Private Limited, with Ampin Energy Transition holding the remainder.

The company’s strategy is directly linked to the rapid expansion of India’s corporate power purchase agreement (PPA) market, which grew to 12 gigawatts in 2023.

Sumitomo forecasts that the market will rise to 100 gigawatts by 2030 as companies seek cleaner and more stable energy supplies amid rising sustainability commitments.

Japanese firms in India drive early power demand

Power generated by the joint venture’s projects will be supplied directly to factories and offices operated by Japanese companies in India.

Sumitomo has so far secured around 10 PPAs with Japanese corporates, many of them manufacturers, including automakers.

These companies increasingly view reliable electricity supply as a major operational challenge, with renewable energy offering both cost competitiveness and decarbonization benefits.

“We seek to meet the demand for more green and competitive electricity and become the largest Japanese power generation company in India,” said Takahiro Jitosho, chairman and managing director of Sumitomo Corp. India.

The renewable facilities are expected to deliver long-term stability for corporate customers, as India continues to deregulate grid access and support private participation in power supply.

PPAs have emerged as a preferred mechanism for companies looking to manage energy costs while lowering emissions.

India’s net-zero push creates new market opportunities

India aims to achieve net-zero greenhouse gas emissions by 2070, a target that will require significant acceleration of renewable capacity additions.

The country currently relies on fossil fuels for about three-quarters of its power generation, underscoring the scale of transition required.

For Sumitomo, the investment expansion reflects both confidence in India’s regulatory framework for renewables and the broader corporate shift toward clean energy procurement.

The joint venture’s pipeline positions the company to benefit from rising industrial electricity demand as global supply chains diversify and manufacturing capacity in India expands.

The Japanese trading house’s increased commitment signals sustained foreign investor appetite for renewable infrastructure in India, driven by long-term growth prospects and expanding corporate uptake.

As Sumitomo scales its portfolio, it aims to play a central role in supplying clean energy to multinational companies operating in one of the world’s fastest-growing power markets.

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Asian markets opened higher on Friday, tracking overnight gains on Wall Street, even as renewed weakness in Oracle shares added fresh pressure to the technology sector.

Investors continued to navigate shifting expectations around US monetary policy, concerns over AI-driven spending cycles, and several major corporate and policy developments shaping global sentiment.

Asian markets climb despite tech-sector volatility

Asian equities advanced in early trading, with MSCI’s broad index of Asia-Pacific shares outside Japan up 0.9%, supported by a mostly positive session in the US where the Dow and Russell 2000 notched new highs.

However, the Nasdaq slipped, reflecting renewed nervousness in the tech sector.

Tokyo’s Nikkei 225 outperformed, gaining 1%, driven by a 6% surge in SoftBank Group after reports that it is considering acquiring US data centre firm Switch Inc.

Futures pointed to a mixed US open. Nasdaq futures dipped 0.18%, while S&P 500 e-mini futures were flat.

Oracle’s 10% plunge weighed on sentiment as investors reacted to the company’s heavy spending plans and softer forecasts, signalling potential delays in returns from AI investments.

The US dollar index slipped to a two-month low following a less hawkish Federal Reserve outlook and weaker US jobless claims data.

Treasury yields edged higher, with the 10-year note at 4.151%.

Trump signs executive order to curb state-level AI regulation

President Trump signed an executive order aimed at preventing individual US states from imposing their own regulations on artificial intelligence.

The move reflects the administration’s concern that a fragmented regulatory environment could slow innovation and weaken US competitiveness against China.

The order directs Attorney General Pam Bondi to establish a task force to challenge state laws and instructs the Commerce Department to identify regulations considered excessively burdensome.

It also threatens to restrict certain federal funds to states pursuing stricter AI rules.

Supporters of the move, including venture capitalist David Sacks, argue that a patchwork of rules could create a “regulatory morass” and hinder startups.

However, lawmakers from both parties criticized the directive, warning that it undermines states’ ability to oversee powerful technologies influencing hiring, lending, housing, and healthcare decisions.

Four states—Colorado, California, Utah, and Texas—have already passed AI-related laws focused on data transparency, discrimination risks, and misuse of deepfakes.

Reddit escalates battle against Australia’s social media age ban

Reddit has filed a High Court challenge against Australia’s newly implemented ban on social media access for users under 16, arguing that the law violates the country’s implied freedom of political communication.

The platform said the ban restricts political discourse for both minors and adults who rely on insights from younger users.

Australia’s law, effective since December 10, applies to 10 platforms, including TikTok, Instagram, YouTube, X, and Reddit.

Companies must apply age-verification measures or face fines of up to A$49.5 million.

A separate challenge backed by two teenagers is already scheduled for a February hearing.

Reddit contends that its platform differs from traditional social networks and that banning underage accounts removes tools that can better protect young users.

Broadcom delivers strong results but faces investor caution

Broadcom posted better-than-expected fiscal fourth-quarter results, with revenue rising 28% to $18.02 billion and adjusted EPS up 37% to $1.95.

Strong performance across semiconductor and software units lifted margins, and the company reported a substantial AI-related backlog exceeding $73 billion.

CEO Hock Tan confirmed large custom chip orders from Anthropic and a new unnamed customer, highlighting robust AI demand into 2026.

However, investor unease surfaced after Tan addressed concerns that major customers could eventually shift custom semiconductor development in-house.

While he called such fears “overblown,” the lack of a definitive dismissal dragged shares lower in after-hours trading.

Broadcom shares have gained 75% year-to-date, making them vulnerable to profit-taking despite raised revenue guidance and a new price target from analysts.

The stock fell 5% in extended trading as the company warned of margin pressure due to a higher mix of AI-related revenue.

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In a major intervention to safeguard industrial jobs, Prime Minister Anthony Albanese announced a rescue effort on Friday to prevent the closure of Australia’s largest aluminium smelter, the struggling Tomago facility majority-owned by Rio Tinto, after its current power contract expires in 2028.

Tomago Aluminium, which employs over 1,000 full-time staff and 200 contractors, previously warned in October of a potential forced shutdown. 

This warning followed the company’s failure to secure new, affordable energy supplies.

Importance of aluminium

Albanese emphasised the increasing importance of aluminium, deeming the continuation of Tomago’s operations vital, according to a Reuters report. 

Speaking at the smelter in New South Wales, north of Sydney, he warned that the failure of Australia to produce aluminium would have “significant” repercussions for other industries.

We are working with the company, we are working with the New South Wales government to make sure there are a long-term energy solutions to go forward beyond 2028.

According to the government, the yet-to-be-finalised deal entails securing a long-term, fixed-price energy supply for the smelter.

As the state’s largest power consumer, Tomago, like other Australian smelters struggling with high energy costs during the shift to renewable energy, was constructed in the last century to capitalise on abundant, inexpensive coal supplies.

“This progress reflects years of collaborative work between Tomago and its joint venture partners, including Rio Tinto, in addressing one of the most complex energy challenges facing Australian industry,” Simon Trott, the chief executive of Rio Tinto, was quoted in a Reuters report.

Investments for modernisation and decarbonisation

Tomago Aluminium, as part of its ongoing commitment to securing its future and modernising its operations, is set to inject a substantial capital investment into its facility over the coming decade. 

The government announced that the smelter would contribute at least A$1 billion, which translates to approximately $666.6 million USD, in capital expenditure and major maintenance investment between now and 2035.

This significant financial commitment is earmarked for several critical areas. 

A substantial portion of the funds will be dedicated to essential major maintenance activities, ensuring the long-term operational stability, efficiency, and safety of the plant’s existing infrastructure.

Crucially, a key focus of this investment will be the identification and exploration of decarbonisation opportunities. 

This signals Tomago’s proactive alignment with broader national and international efforts to reduce industrial greenhouse gas emissions. 

The funds will likely be used to investigate and potentially pilot new technologies, such as inert anode technology, carbon capture, utilisation, and storage (CCUS), or transitioning to a higher share of renewable energy sources for its power needs. 

This commitment to green investment aims to future-proof the smelter in a rapidly evolving energy landscape, securing its role as a major regional employer and industrial asset for years to come.

Tomago’s chief executive, Jerome Dozol, expressed gratitude to both the federal and New South Wales governments in a statement, emphasizing the company’s eagerness to collaborate with the government moving forward.

Broader industry aid and union endorsement

The government has recently extended support to several major industrial facilities, with the smelter being the most recent recipient of aid. 

These bailout packages have previously benefited Glencore’s Mount Isa copper smelter and Townsville refinery, Trafigura’s Nyrstar lead and zinc operations, and the Whyalla steel plant.

The Tomago agreement, which has been hailed by the Australian Workers’ Union as a “pivotal moment for manufacturing,” includes government provisions for concessional finance. 

These arrangements are designed to speed up the development of renewable energy generation and storage. 

Industry Minister Tim Ayres noted that the government is still calculating the total financial cost of the deal.

Tony Callinan, the union’s secretary in the state, was quoted in the report:

We now look forward to seeing the detail of the rescue package and will continue working with all parties to ensure Tomago has a sustainable long-term future.

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Lululemon Athletica shares surged nearly 11% in after-hours trading on Thursday after the retailer reported stronger-than-expected third-quarter results and said Chief Executive Calvin McDonald will step down early next year.

Revenue rose 7% from a year earlier to $2.6 billion, exceeding Wall Street estimates of $2.48 billion. Adjusted earnings of $2.59 per share also topped analyst forecasts of $2.21 per share, according to FactSet.

Alongside the earnings beat, the company raised its full-year outlook, projecting net sales between $10.962 billion and $11.047 billion, slightly higher than its previous range.

Full-year earnings per share are now expected to come in between $12.92 and $13.02.

Leadership transition coincides with slowing momentum in American market

The company said McDonald will step down on January 31, though a permanent successor has not yet been named.

Chief Financial Officer Meghan Frank and Chief Commercial Officer André Maestrini will serve as interim co-CEOs while the board searches for a long-term leader.

“Lululemon has a strong foundation in place,” executive chair Marti Morfitt said, adding that the board is seeking a leader experienced in guiding companies through periods of significant expansion and transformation.

The leadership shake-up comes at a challenging time for the apparel giant, which has struggled to reignite momentum in the Americas, its largest market.

Comparable-store sales rose 1% globally but declined 5% in the region.

Founder Chip Wilson has pushed for changes in the board as stock underperforms

Despite a strong Black Friday weekend, demand softened in the weeks that followed, prompting the company to issue a more cautious fourth-quarter forecast.

Sales in the Americas fell 2% in the most recent quarter, underscoring the slowdown in Lululemon’s core market.

Founder Chip Wilson has applied pressure on the board in recent months, pushing for changes to revive innovation and restore what he describes as an entrepreneurial culture.

Wilson has expressed frustration with the company’s marketing strategy, though it remains unclear whether McDonald’s exit will influence his next moves.

Analysts say the slowdown has weighed heavily on investor sentiment, with shares down more than 50% this year.

“They lost share in a increasingly competitive athleisure market and specifically have not been able to successfully address its weakening share of the core women’s pants despite multiple attempts to address that,” said Matt Jacob, analyst at research and analytics firm M Science.

“So that will be a challenge for the new permanent CEO.”

Morningstar Research analyst David Swartz said while McDonald has been an effective CEO, investors seem to be satisfied that Lululemon’s board is taking “aggressive action”.

Growth abroad but questions at home

Under McDonald’s leadership, Lululemon expanded to more than 780 stores worldwide, grew its men’s segment, and entered new categories such as tennis and golf.

But recent decisions — including partnerships with Disney and the NFL — have puzzled some analysts.

“Lulu’s NFL partnership looks less like a bold growth initiative and more like a Hail Mary from a management team struggling to regain momentum,” Jefferies analyst Randal Konik wrote in October.

Meanwhile, the company said it expects a smaller impact from tariffs than previously forecast, citing progress in negotiations with vendors and efficiency improvements across its distribution operations.

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Taiwan’s equity market continues to move against the prevailing global mood around artificial intelligence.

While investors elsewhere are questioning whether AI valuations have stretched too far, Taiwan’s tech-heavy stocks show little sign of losing momentum.

The contrast reflects a growing divide between foreign caution and local conviction, reports Reuters.

For domestic investors, the focus is less on hype cycles and more on Taiwan’s entrenched role in the global AI supply chain.

That structural positioning, rather than short-term sentiment, is shaping how the market interprets risk and reward.

Taiwan’s benchmark index is expected by investors to breach the 30,000 mark in 2026, extending a rally that has nearly doubled the market over the past three years.

The gains have been powered by sustained demand for chips that enable artificial intelligence, placing Taiwan at the centre of one of the most critical technology shifts in decades.

Supply chain depth over AI hype

A key reason Taiwan’s rally has held up is the belief that its companies benefit regardless of how the AI race evolves.

While global investors worry about whether Nvidia can maintain its dominance, alternatives such as Google’s tensor processing units are emerging as potentially cheaper computing options.

For Taiwan, this competition is not seen as a threat.

The island is essential to the production of both graphics processing units and tensor processing units, which form the backbone of AI computing.

As competition increases, Taiwanese firms stand to gain from higher volumes across multiple platforms.

TSMC, the world’s largest contract chipmaker, remains the anchor of this ecosystem, alongside a wide network of suppliers and materials firms.

Local analysts argue that this makes Taiwan less exposed to single-company risk than other AI-focused markets.

Even if leadership shifts within the AI hardware space, Taiwan’s manufacturing role remains intact.

Earnings keep valuations in check

Unlike some global peers, Taiwan’s market has not seen valuations inflate sharply alongside price gains.

Earnings growth has helped stabilise price-to-earnings ratios, which sit around 21, below those of the Nasdaq and Japan’s Nikkei.

This has reinforced the view that the rally is supported by fundamentals rather than speculation.

Comparisons with the dot-com era are often raised in discussions around AI bubbles.

Investors in Taiwan point out that today’s leading technology firms are generating meaningful earnings, with some US tech giants posting gross margins as high as 70%.

This profitability backdrop has eased concerns that the current cycle mirrors past excesses.

Major investment banks share this assessment.

Recent research from Goldman Sachs described the current AI environment as falling short of a full-scale bubble, with strategists maintaining an overweight stance on technology stocks.

Profitability risks still on the radar

That does not mean risks are absent.

Questions remain around how quickly AI applications can translate into sustainable profits, and whether slower adoption could eventually weaken demand for high-end hardware.

These concerns are part of the broader debate shaping global investor sentiment.

In Taiwan, however, confidence is underpinned by strong order books and the country’s importance within the supply chain.

As per Reuters, analysts say these factors give local tech firms several more years of cash generation, even if growth rates moderate later on.

Goldman Sachs expects hyperscaler investment to rise sharply in 2026 and 2027, reaching $552 billion and $644 billion, respectively.

The bank sees the broader Taiwan index reaching 30,200 within the next 12 months, implying a 7% upside from current levels.

Foreign selling fails to derail rally

Taiwan’s market performance has also stood out because it has advanced despite heavy foreign selling.

Overseas investors have sold a net T$533.8 billion, or about $17 billion, of Taiwanese shares so far this year, following net outflows of roughly T$695.1 billion in 2024, according to exchange data.

Those sales have been driven by trade uncertainty, AI-related concerns, and profit-taking after strong gains.

Even so, Taiwan’s stocks have hit record highs throughout the year and are up 22% in 2025, broadly keeping pace with the Nasdaq.

The market has lagged behind South Korea’s Kospi, Hong Kong’s Hang Seng, and Japan’s Nikkei among major Asian indices, but domestic sentiment remains firm.

Strategists at HSBC noted this month that the average Asian portfolio holds 10% in a single stock, TSMC, and advised investors to diversify beyond crowded AI trades.

Despite that concentration risk, fund managers continue to describe Taiwan as an irreplaceable part of the global AI supply chain, with an ecosystem that would be difficult to replicate elsewhere.

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Novo Nordisk has officially launched Ozempic in India, marking a significant expansion of its presence in one of the world’s fastest-growing markets for diabetes and obesity treatments.

The launch comes at a time when demand for weight-loss drugs is rising sharply, driven by lifestyle changes, urbanisation, and increasing awareness of metabolic health.

India already has the second-highest number of people with type 2 diabetes globally, after China, alongside steadily climbing obesity rates.

For Novo, the Indian rollout represents both a commercial opportunity and a strategic move to establish early scale before lower-cost competitors enter the market.

Pricing and dosage strategy

Ozempic will be sold in India in a pen format, with three dosage options of 0.25 mg, 0.5 mg, and 1 mg.

Each pen contains four weekly doses, aligning with the drug’s once-a-week injection schedule.

Novo Nordisk has priced the 0.25 mg dose at Rs 8,800 per month, equivalent to about $24.35 per week.

The 0.5 mg version is priced at Rs 10,170 per month, while the 1 mg dose costs Rs 11,175 monthly.

The tiered pricing structure reflects a balance between accessibility and premium positioning in a price-sensitive healthcare market.

Medical use and broader benefits

Ozempic, whose active ingredient is semaglutide, was approved by the US Food and Drug Administration in 2017 for the treatment of type 2 diabetes.

Since then, it has become a global bestseller.

While its primary indication is glycaemic control, the drug is widely used off-label for weight loss due to its appetite-suppressing effects.

Beyond blood sugar regulation, the medication has also been shown to reduce the risk of cardiovascular events and kidney-related complications in people with diabetes.

Clinical experience indicates that patients with diabetes can experience weight loss of up to eight kilograms, highlighting benefits that extend beyond glucose management.

India as a key growth market

India’s large and growing patient base makes it a critical battleground for global drugmakers targeting metabolic diseases.

Rising disposable incomes, changing diets, and sedentary lifestyles have contributed to an increase in both diabetes and obesity prevalence.

This has created strong demand for newer, more effective treatments, particularly injectable therapies with proven outcomes.

Experts estimate that the global weight-loss drug segment could reach $150 billion in annual sales by the end of the decade, underscoring why companies like Novo are moving quickly to secure market share in high-growth regions such as India.

Competitive timing and patent horizon

According to Reuters, Novo Nordisk’s India launch follows earlier indications that the company was aiming to introduce Ozempic this month to establish a foothold ahead of domestic generic manufacturers.

That timing is significant, as semaglutide is set to go off patent in March 2026.

Once exclusivity ends, Indian drugmakers are expected to roll out cheaper versions, intensifying competition and putting pressure on pricing.

By entering the market now, Novo gains brand recognition and physician familiarity before generics arrive, potentially helping it retain a segment of patients even as alternatives become available.

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Canopy Growth stock price staged a strong comeback in the pre-market session as investors cheered the latest news on cannabis rescheduling. CGC jumped by over 35% to $1.530, pushing its market cap to over $400 million. So, will the stock’s gains hold?

Canopy Growth stock jumps amid rescheduling news

Canopy Growth is one of the biggest players in the crypto industry, where it offers brands like Tweed, Tokyo Smoke, Deep Space, Doja, and Ace Valley.  It also owns Spectrum Therapeutics, its medical cannabis brand. 

The CGC stock price is in a strong uptrend after the media reported that Donald Trump was considering rescheduling cannabis into a less dangerous drug, continuing a process that Joe Biden started.

Such a move would be highly beneficial to Canopy Growth and other companies in the industry. This explains why cannabis stocks like Tilray Brands and Green Thumb Industries are soaring. The closely-watched MSOS ETF jumped by over 30% in the premarket session. 

This is not the only time that Donald Trump has fueled gains in the cannabis industry. Mid this year, he pushed the CGC stock price to a high of $1.93 from a low of $1.02 after revealing that he was considering rescheduling marijuana. It then soared after he promoted CBD for senior citizens on Truth Social, its social media platform. 

A cannabis rescheduling would be a good thing for Canopy Growth, as it would make it easy to do business in the United States. It would also simplify how it does business and its banking operations. 

Canopy Growth business is sending mixed signals

The most recent results showed that the company’s business was sending mixed signals. Its revenue rose by 6% in the second fiscal quarter to $67 million, a sign that its demand was steady. 

Most of this growth was from the cannabis business, whose revenue rose by 12% to $51 million. Canada’s adult-use and medical cannabis revenue soared by double digits, while its international markets dropped. 

On the other hand, the Storz & Bickel revenue dropped by 10% to $16 million, which the management blamed on the growing economic uncertainties. 

There were other potential catalysts in the report. For example, the company’s balance sheet improved, with its cash and short-term investments rising to over $298 million. Its long-term debt dropped from $299 million in March to $226 million. 

However, the company’s balance sheet improvement has coincided with the soaring outstanding shares. Its shares jumped to 332 million from a low of 129 million in January. An increasing number of outstanding shares normally leads to dilution, which reduces the earnings per share.

CGC stock price technical analysis

The daily chart shows that the Canopy Growth stock price dropped from a high of $1.93 to a low of $1.02. It then rebounded to $1.40, its highest level since October. 

The rebound happened as the stock formed the highly bullish double-bottom pattern at $1.02. This is one of the most bullish patterns in technical analysis. It also formed a bullish divergence pattern. 

Therefore, the stock will likely have a strong bullish breakout as expectations of rescheduling continues. This means that the stock may hit the resistance at $1.50. 

However, the rebound may maintain its volatility as the rescheduling debate continues. A drop below the support at $1.02 will invalidate the bullish outlook.

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‘Tempus fugit, ’ as we cry out at closing time in my local Wetherspoons.

We’re already more than a quarter of the way through December and speeding at full throttle towards year-end.

Where has the time gone? The Federal Reserve has just held its last meeting of 2025 and cut interest rates by 25 basis points, as expected.

Ahead of the decision, analysts were calling for a ‘hawkish cut’, and that is pretty much what was delivered.

The FOMC’s ‘Dot Plot’ (part of the quarterly Summary of Economic Projections) had a median forecast of just one-quarter-point cut next year, probably in the first half.

But there was a great deal of dispersion across the dots.

Out of the nineteen FOMC members, one anticipates six cuts next year (that would take the Fed Funds rate down to 2.00-2.25% from current levels, well below inflation forecasts), while at the other end, three members see one rate hike.

According to the CME’s FedWatch Tool, the ‘real money’ sees one, maybe two reductions, which is pretty much in line with the Fed itself.

We now have another twelve months to go before we’ll know how accurate this prediction turns out to be.

The Fed’s current rate-cutting cycle began back in September 2024 when they surprised most people by announcing a 0.50% reduction.

This was double the forecasts, and somewhat controversial given that it came just two months before the Presidential Election.

The Fed made two further quarter-point cuts before the year-end, before going on hold until this September, blaming the possible inflationary effects of tariffs.

This drew the ire of President Trump, who felt that the US central bank had politicised monetary policy, and he may have a point.

Overall, rates were reduced by 100 basis points last year, and a further seventy-five points in 2025, for a total of 175, taking the Fed Funds rate range down to 3.50-3.75%, its lowest in over three years.

All that monetary stimulus was a pretty powerful tailwind for risk assets, which, given yesterday’s forecast, will lose a lot of its force going forward. Despite this, the FOMC vote breakdown shows little appetite for raising rates, so that’s a blessing.

The rest of the FOMC’s Summary was also quite upbeat. Members upgraded their growth outlook for next year.

They now expect GDP growth of 2.3%, up from 1.8% in September.

Inflation (as measured by Core PCE) is expected to moderate to 2.5% by the end of 2026, down from its current reading of 2.8% annualised, and below September’s prediction of 2.6%. It is still expected to hit the Fed’s 2% target in 2028.

Meanwhile, Unemployment is forecast to hold steady at 4.4%, which remains historically low.

All in all, that’s a fairly solid set of forecasts, which was enough to see risk assets rally and the US dollar fall.

In his subsequent press conference, Chair Jerome Powell said that the Fed was now in ‘wait and see’ mode, as is Mr Powell himself.

His second term as Chair ends in May, yet speculation over the identity of his successor has been swirling around since President Trump’s inauguration in January.

Mr Trump has said he has decided on his preferred candidate, and Treasury Secretary Scott Bessent has suggested that this could be announced before Christmas.

Kevin Hassett, the current Director of the National Economic Council, is considered the shoo-in candidate.

He’s a well-known Trump supporter and a well-known dove.

But Kevin Warsh can’t be ruled out either. He has served as a member of the Federal Reserve Board of Governors and is a Republican.

He’s also a handsome chap, which may give him an edge over Mr Hassett in President Trump’s eyes. Let’s keep the Administration beautiful.

What does all this mean? Well, there’s some uncertainty creeping in over at the Fed, and evidence of growing diversity of expressed opinions.

It also feels as if the rule of the Chair won’t be quite as absolute as it has been in the past.

These aren’t bad things. It’s time that the Fed had a bit of a shake-up. But once his replacement is named, Jerome Powell’s life is going to get a lot harder.

There will effectively be two Fed Chairs for the next five months, and both will be scrutinised intensely.

Disagreements will be highlighted. And that has the potential to affect decision-making negatively.

(David Morrison is a Senior Market Analyst at Trade Nation. Views are his own.)

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In Venezuela, money does not enter the economy as a steady stream. Instead, it arrives in bursts, timed to crude cargoes leaving port.

That is why a single ship seizure can feel like a national budget event. This week, the US made the shipping lane the front line again, and it put a hard spotlight on an old truth.

Venezuela’s economy still runs on oil cash, and oil cash still depends on whether a tanker can move.

The recent US – Venezuela tensions bring some economic worries, not only for Venezuela itself, but for US markets too. Investors would rather be prepared than get caught off-guard again.

An economy that runs on dollars and breaks on inflation

Venezuela’s economy shows growth that barely registers and inflation that still dominates everything.

The International Monetary Fund projects 0.5% real GDP growth for 2025 and 269.9% inflation.

These numbers describe an economy that cannot build stable purchasing power or long-term planning.

The exchange rate tells the same story in a language every Venezuelan understands.

As of mid-December 2025, the bolívar trades near 264.7 per US dollar on widely followed market trackers.

The World Food Programme’s VAM exchange rate series shows an 80.67% depreciation from October 2024 to October 2025.

In a country that imports a large share of essentials, that depreciation becomes food prices, transport costs, and pharmacy shortages.

Wages offer little protection. Switzerland’s SECO reports the statutory minimum wage remains 130 bolívares per month, with pay increasingly delivered through bonuses rather than base salary.

This matters because bonuses do not rebuild the tax base, pensions, or creditworthiness. They also do not anchor inflation expectations.

So the result is a split economy. Some transactions happen in dollars in pockets of the country, but the broader price system still reacts to the bolívar’s slide.

The social data fills in the last piece. The WFP reports that about 15% of the population, roughly 4 million people, urgently need food assistance, and around 40% face moderate to severe food insecurity.

When inflation accelerates again, this is where it shows first.

The ship seizure that turned politics into a shipping problem

The current episode is not a generic rise in tension, but rather a change in tactics.

The United States has moved from talking about pressure to physically interfering with the oil trade that funds the state.

This week, the US seized the tanker Skipper near Venezuela’s coast. Reuters reported Venezuela called the action “blatant theft.” The immediate loss is the cargo.

The larger impact is the message it sends to every ship owner, insurer, and trader involved in moving Venezuelan crude.

Washington then expanded the target list. New US sanctions have been announced, aimed at six tankers and shipping entities, along with individuals tied to the Venezuelan leadership.

The US is preparing to seize more tankers, which is the kind of signal that changes contracts and behavior before any new seizure happens.

This is where the story becomes economic. If sanctions are a legal fence, tanker seizures are a roadblock on the highway.

They increase the cost of moving oil, raise the risk of payment disruption, and force more of the trade into opaque channels that demand bigger discounts.

Oil flows still exist. Shipping data shows crude and fuel exports rose to about 921,000 barrels a day in November 2025, with roughly 80% going to China, about 150,000 barrels a day to the United States, and a smaller flow to Cuba.

That export level is high enough to fund imports, but only if the dollars arrive smoothly.

The US is now pressing the part of the system that converts barrels into cash.

Why tanker pressure hits Venezuela harder than a bad oil price week

The simplest way to understand Venezuela’s vulnerability is to follow the dollars.

Oil exports supply the hard currency that pays for imports. Imports supply the goods that keep prices from spiraling faster.

When net dollar inflow falls, the bolívar weakens, inflation rises, and real wages collapse again.

Tanker seizures and shipping sanctions damage net inflow through three mechanisms.

First, they can reduce liftings by delaying cargoes and disrupting schedules. Second, they force deeper discounts.

Buyers demand compensation for legal and operational risk. Third, they raise transaction costs. Insurance and freight prices rise when the probability of interruption rises.

Reuters has already captured this repricing in the market plumbing. It reported that contracts to ship Venezuelan crude have become more expensive, with vessel owners inserting war clauses to protect against disruption or seizure risk.

It also reported that Venezuelan crude has faced steeper discounts in Asia as sanctioned barrels compete for a limited set of buyers willing to take the risk.

A key detail often missed outside energy desks is that Venezuela’s heavy crude is operationally fragile.

It can require diluents like naphtha to blend and move. Reuters linked November’s export rise to higher diluent imports after problems at an upgrader.

If enforcement pressure complicates those inputs or raises their cost, export capacity can fall even without any damage to wells.

Then there is Chevron. The US has used licenses to allow certain flows, and investors read those licenses as a floor under Venezuela’s cash conversion.

OFAC’s Venezuela program lists Chevron-related authorizations within its general license structure, including General License 41B language.

If Washington keeps a protected lane for Chevron-linked exports while squeezing gray shipping, Venezuela’s economy shifts toward a narrower, more US-controlled cash channel.

If that lane narrows too, the downside becomes abrupt.

What is the market impact of US-Venezuela tensions?

Most global investors will not trade Venezuela directly, and that is rational.

The country is small in global GDP terms and its capital markets are thin.

The market impact comes through narrower pipes, and those pipes move prices in ways that surprise people who only watch equity indexes.

The first pipe is sanctions credibility. A speech rarely changes oil pricing for more than a day. A seized tanker changes behavior.

Traders demand wider discounts, ship owners charge more, and compliance departments tighten.

That shows up in heavy crude spreads, freight rates, and the relative performance of complex refiners versus simple refiners.

It can also lift near-term oil volatility even if global supply does not change much.

The second pipe is duration risk. Equities often shrug at a single strike or a single sanction.

They reprice when policy becomes unpredictable over months. Repeated seizures, widening designations, carve-outs, and exceptions create uncertainty that is hard to hedge.

That uncertainty can bleed into emerging market risk pricing even if Venezuela itself is not investable, because it increases the sense that US policy can swing quickly and hit cash flows elsewhere.

The third pipe is political optionality. Distressed Venezuela-linked instruments behave like options.

When the policy regime changes, prices can move violently because the starting point is already depressed.

Pressure can lift those prices if investors believe it increases the odds of a settlement, a restructuring path, or a shift in license policy.

At the same time, broad US equities can barely react because the capital involved is tiny relative to global markets.

The clean investor takeaway is that this story is not about Venezuela’s reserves.

It is about the cash mechanics of a barrel. When enforcement targets shipping, the economic shock travels faster than the headlines, because it hits the one thing Venezuela still cannot replace: dollars arriving on time.

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