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Swiss GDP fell -0.5% qoq in Q3, marking a sharp reversal driven almost entirely by the chemical and pharmaceutical sector. After strong momentum earlier in the year, the industry saw output plunge -7.9%, erasing prior gains and dragging the broader economy into contraction.

Authorities noted that the downturn reflects recent volatility in foreign trade. Earlier quarters saw a surge in pharma exports, partly driven by front-loading ahead of U.S. trade-policy changes. Those temporary boosts have now unwound, resulting in a "compensatory decline" that weighed heavily on Q3 activity.

Full Swiss GDP release here.

The short-term Elliott Wave outlook in GBPJPY indicates that the cycle from the October 2, 2025 low remains in progress as a five-wave diagonal structure. From that date, wave ((i)) concluded at 205.3, followed by a corrective pullback in wave ((ii)) that reached 199.05. The pair then advanced in wave ((iii)), achieving 206.85, as reflected in the 45‑minute chart. Subsequently, wave ((iv)) unfolded in the form of a zigzag pattern. Within this correction, wave (a) ended at 205.63, wave (b) terminated at 206.21, and wave (c) completed at 204.31. This final leg also marked the completion of wave ((iv)) at a higher degree.

From that point, the pair resumed its upward trajectory in wave ((v)), which developed as an impulse structure of lesser degree. Rising from wave ((iv)), wave i concluded at 206, while wave ii corrected to 205.26. The advance continued with wave iii reaching 207.2, before wave iv pulled back to 206.41. The current expectation is that the pair will soon complete the cycle from the November 21 low in wave v of (i). Following this, a corrective phase in wave (ii) should emerge to balance the preceding advance before the rally resumes.

As long as the pivot at 204.31 remains intact, dips are anticipated to find support. These supports are likely to appear in sequences of three, seven, or eleven swings, reinforcing the broader bullish outlook. The structure suggests that the market retains a constructive bias, with corrections offering opportunities for continuation rather than signaling exhaustion.

GBPJPY 45-Minute Elliott Wave Chart From 11.28.2025

GBPJPY Elliott Wave Video:

https://www.youtube.com/watch?v=n2uqgmqZLBc

Markets

US markets were closed for Thanksgiving yesterday and second tier EMU eco data failed to impress. The result was a dull, low volume, trading session. Minutes of the previous ECB meeting confirmed the central bank’s current comfortable position with the bar being very high to change that. EC November economic confidence data printed near consensus. Russian president Putin signaled willingness to negotiate a peace deal by saying that US President Trump’s proposals for end the war could be the basis for future agreements. No final version exists yet with US official heading to Moscow next week for further discussions. He was happy to learn that the US took into account Russia’s position as discussed when the two presidents met in Alaska. European stock markets closed almost unchanged after a day of treading water near opening levels. German bond yields added 1 bp across the curve while EUR/USD remained stuck at 1.16. EUR/GBP also went nowhere at 0.8758. The “relief” rally following UK Chancellor Reeves’ Autumn budget proved short-lived. We stressed before that it might be a battle won by the UK government, but the fight ain’t over.

US markets close early today with traded volumes traditionally lower the (Black) Friday after Thanksgiving. Eco data are confined to Europe with national inflation readings in Spain, France, Italy and Germany. Yesterday’s numbers released in Belgium showed a significant acceleration, but that doesn’t necessarily mean that we’ll get the same today as national policies obviously can play an important role. Taken into account the firm ECB stance, EMU eco data generally lost market-moving potential. It leaves general risk sentiment as today’s main global market driver. Stock markets crawled back this week, avoiding a sell-on-upticks pattern. We’ll see how much dash is left going into the weekend.

News & Views

Japanese data published this morning at least confirm that conditions are falling into place for the Bank of Japan to make a next step in the process of policy normalization in the near future. November Tokyo CPI inflation, seen as pointer for national data to be published next month, remained well above the BoJ’s 2% inflation target. Headline inflation eased marginally from 2.8% to 2.7%. Core measures (ex fresh food & ex fresh food and energy) were both unchanged at 2.8%. Food price inflation slowed to 0.3% M/M and 5.5% Y/Y (from 5.8%). Utility prices again rose a solid 4.1% M/M (2.4% Y/Y). Services prices inflation eased slightly to 1.5% Y/Y from 1.6%. Price rises for goods were still a strong 4% Y/Y. In this respect, the weak of level of the yen might become an ever bigger factor in the BoJ’s assessment. Aside from the price data, activity indictors also showed resilience with both October production growth (1.4% M/M and 1.5% Y/Y) and retail sales (1.6% M/M) substantially beating expectations. The unemployment rate remained unchanged at 2.6%. The next BoJ policy decision is scheduled for December 19. The market currently discounts a probability of a rate hike of about 60%. The yen whipsawed but holds basically unchanged near USD/JPY 156.35.

Consumer confidence in New-Zealand as measured by the ANZ-Roy Morgan survey improved substantially in November, rising from 92.4 to 98.4 and reaching the best level since June. Consumers, amongst others, turned more positive on the economy, both for the next year and further out. Also ANZ business confidence jumped sharply in November from 58.1 to 67.1. This is the best level since March 2014. The release of these solid confidence data come after the RBNZ earlier this week cut the policy rate by 25 bps to 2.25%, but indicated that the bar for further easing is high as the current level of the policy rate is low enough to support activity going forward. Even so, after a sharp rebound after the RBNZ decision, the kiwi dollar this morning eases marginally to NZD/USD 0.5715. It traded below 0.56 at the start of the week.

It’s boring when the US is not here. All the show, the drama, the buzz, the rumours stop – all of a sudden – and we are left to look back and think. So let’s think. It was a harsh month. The S&P 500 companies announced strong earnings: earnings growth came in at an impressive 13.4% for the entire index. Health care, financials and consumer discretionary were leading sectors, along with technology, of course.

Most Big Tech names reported better-than-expected earnings and stronger-than-expected guidance – including Nvidia. But instead of being the best day of the earnings season, Nvidia’s earnings day turned into drama. Investors – too used to blockbuster results – decided to dig into the reports. And the gap between accounts receivable and incoming cash, along with swelling inventories, became the focal point and added to circularity worries around the latest AI deals. Nvidia’s earnings – which were supposed to give comfort to tech investors – had the exact opposite effect. The bad press took over, and things have been quite downhill since. Earlier this week, Nvidia was trading up to 20% lower than its latest peak a month ago. Meta is accused of offloading its debt to private equity companies to keep its books clean, and the circularity of the deals around OpenAI – and OpenAI itself – is under heavy criticism.

The good news is that the Fed doves jumped in at the right time – last Friday – to make sure that the tech-led rally didn’t reverse and take global stocks down with it. The probability of a Fed cut went from below 30% to 85%, giving the world space to breathe as the US left for Thanksgiving.

Since then, nothing much. European stocks barely moved yesterday, while Asian tech stocks looked bleak, with Alibaba finding no support despite strong results and news that it has already introduced AI glasses to compete with Meta.

In vain, the HSI looks uninspiring to global investors, and the Korean Kospi and Japan’s SoftBank – a few names I watch to feel the heat in technology – are struggling.

For the S&P 500, expectations for future quarters have softened. Projections are pointing at lower revenue growth over the next five quarters, ranging between 5% and 8%. In contrast, according to FactSet, analysts expect higher earnings growth for the Mag 7 over the next four quarters, between 18% and 25%.

Meanwhile, valuations are high (above 5 and 10-year averages), and we would need a drop of a bit more than 5% to call it a correction.

So here we are. I’m already being asked whether we will see a Santa Rally. And my answer is: hard to tell. Really hard to tell because there is so much uncertainty in the market right now: uncertainty around AI valuations, uncertainty around Japanese yields as Takaichi pushes for higher spending and higher borrowing in Japan, and uncertainties, of course, regarding what the Federal Reserve (Fed) will do – and what the Fed should do.

Even though I believe the best thing for the Fed would’ve been to wait a month and deliver a rate cut when the sky is clear and the data is out, truly, given the Fed probabilities – and the wild swings we’ve seen – it would be dramatic for expectations to snap back to ‘no cut’. It would inject an incredible amount of volatility into the market and make the Fed look foolish – and they really don’t need that right now.

So, we will probably get that 25bp cut. The question is: what happens after? If the inflation report (due the week after the decision) remains as subdued as it has been for the rest of the year, the way could be cleared for a Santa Rally – because no one wants to book profits after such a stellar year, right? We could see some profit-taking in January. Or we get a hot inflation report that vanishes the dream of 2026 cuts – we’re talking about 2–4 cuts – and the selloff deepens before year end. And regarding the accuracy of US data, well, it will take time to see whether the data is being tweaked to serve the White House’s lower-rate ambitions.

The US dollar is preparing to close the week on a slightly better note, and returning above the 200-DMA should help the greenback stay on course for further recovery of this year’s losses. The downside potential in the euro is limited as the European Central Bank (ECB) is not willing to cut rates further, with policy looking – and feeling – like it is in a good place at the moment. A very rare feeling, indeed.

For Japan, the story remains the same: the USDJPY will weaken along with the rising pressure on JGBs, while sterling sees the post-Budget appetite gently wane. Gilt yields rebounded yesterday on the realization that the Budget – though eventless – didn’t necessarily hint at a sustainably better fiscal picture. And it cannot. When productivity and growth slow, the only way to get more money in is by collecting higher taxes and issuing more debt. More taxes being deflationary, the Bank of England (BoE) could get back to cutting rates in December. Cable looks good to sell.

In commodities, gold is back to gains as softening Fed expectations and lower US yields bring inflows into the yellow metal – that’s good because gold is acting as you would expect, shrugging off the impact of the speculative moves of late summer.

Crude oil, on the other hand, is better bid into the OPEC meeting weekend. OPEC is expected to reiterate its intention to pause production increases when it meets this weekend to relieve downside pressure on oil prices. Indeed, oil prices have been falling this year despite many rate cuts from major central banks and a cheaper US dollar – both fundamentally supportive of prices. That means that ample OPEC and non-OPEC supply has weighed heavier on price dynamics. So OPEC knows that if it wants to throw a floor under cheapening prices, it must restrict production. But the thing is, OPEC’s share in the global oil market has been narrowing, meaning that lower supply – even fresh supply restrictions – may not reverse the bearish trend if the US keeps “drill, baby, drill.”

In focus today

In the euro area, the inflation flash estimates are released for Germany, France, Italy, and Spain which together will reveal almost entirely how inflation in the euro area fared ahead of the aggregate data next week. We expect headline inflation remained at 2.1% y/y in November and core inflation remained at 2.4% y/y as in October.

In Sweden, the Q3 GDP statistics are announced. Preliminary estimates indicate growth of 1.1% q/q (2.4% y/y) and although the GDP indicator is highly unreliable and prone to revisions, broader activity data supports the notion of a tentative recovery. Private consumption increased in September and appeared to be the main driver of Q3 growth, which we expect to print at 0.9% and 1.7% y/y.

In Norway, we expect the seasonally adjusted unemployment rate to be unchanged at 2.2% in November, but the number of unemployed to increase, signalling a gradually weaker labour market. We also keep an eye on new vacancies, as they can act as an indicator of labour demand. We expect retail sales grew 0.5% m/m in October after a couple of weak months. High real wage growth, lower mortgage rates and still low unemployment should support private consumption going forward, and we see some upside risk to our estimate.

Economic and market news

What happened overnight

In Japan, Tokyo November CPI released at 2.8% y/y (cons: 2.7%) and CPI excl. fresh food and fuel remained at 2.8%. October retail sales surpassed expectations at 1.7% y/y (cons: 0.8%) and marked the strongest uptick in four months. The largest increase in sales was seen in machinery and equipment (8%), pharmaceuticals and cosmetics (5.1%) and automobiles (4.8%). Additionally, the unemployment rate held steady at 2.6% in October and it appears the economy is weathering the impact of higher US tariffs. Markets are now pricing in slightly more than a 50% chance of an interest rate hike from the Bank of Japan at the December meeting.

What happened yesterday

In the euro area, the ECB minutes from the October meeting did not reveal much new information and the wording was very balanced. The ECB GC members are clearly in no rush to change policy rates and continue to see "a high option value in waiting for additional data." Most members saw inflation risks as two-sided and balanced.

On the data side, credit growth for October released above expectations with adjusted loans to non-financial corporations increasing by 2.9% y/y. Loan growth to households increased to 2.8% y/y from 2.6% in September. The readings were above expectations of a slowing momentum which we expected would result in a smaller reading.

In Denmark, retail sales for October surprised to the upside, with a reading of 0.9% m/m and 4.9% y/y in October, marking the highest monthly gain since February 2024. The main driver can be found in other consumer goods, which increased by 8.6%, up from 7.6% in September, and food and other groceries which were up 0.9% vs -2.0% in September.

In Sweden, the NIER survey showed overall sentiment improving to 101.7 in November from 100.9 in October. Consumer confidence disappointed and declined following six months of positive gains. The decline appears to be driven by a slightly more negative view of the domestic economy.

The Swedish National Debt Office (NDO) presented an updated forecast and borrowing plan. The borrowing requirement for 2026 was revised up by SEK 89bn, bringing the total deficit- or net borrowing requirement to SEK 173bn. The NDO stated that the increase "is mainly due to expansionary fiscal policy".

Equities: Thursday was a quiet day in markets, as US was closed for Thanksgiving. European equities edged slightly higher, with the Stoxx 600 up 0.1% and the MSCI Nordics up 0.4%. As Nordics have lagged in the recent rebound, it would make sense if Nordics outperformed on the coming trading days. Beneath the surface, the tone was risk-on, with global cyclicals and small caps outperforming. It is unclear if this continues today, as futures markets are closed this morning due to technical issues. However, Asian markets are little changed, which gives a hint of another slow trading day today. US markets will reopen today, but only for a half-day session.

FI and FX: Small to no moves in the rates and equity space as US is closed for Thanksgiving. US10y flat at 4%, equity futures in green. Scandi FX traded modestly higher yesterday. EUR/SEK is just below 11.00 ahead of month-end, which we estimate could generate a small need to sell SEK for rebalancing purposes. Focus on today's Swedish GDP data, a well. EUR/NOK trades around 11.88 going into the Norwegian data releases this morning.

Daily Pivots: (S1) 206.52; (P) 206.86; (R1) 207.28; More...

Intraday bias in GBP/JPY remains on the upside at this point. Current rally from 184.35 should target a retest on 208.09 high. Firm break there will confirm larger up trend resumption. On the downside, below 205.29 minor support will turn bias neutral again.

In the bigger picture, price actions from 208.09 (2024 high) are seen as a corrective pattern which might have completed at 184.35. Firm break of 208.09 high will resume the up trend from 123.94 (2020 low). Next target is 61.8% projection of 148.93 to 208.09 from 184.35 at 220.90. However, decisive break of 199.04 support will dampen this view and extend the corrective pattern with another fall.

Daily Pivots: (S1) 180.85; (P) 181.14; (R1) 181.51; More...

Consolidations continue below 181.98 and intraday bias stays neutral in EUR/JPY. Deeper retreat cannot be ruled out, but downside should be contained by 178.80 resistance turned support to bring another rally. On the upside, break of 181.98 will target 100% projection of 161.06 to 173.87 from 171.09 at 183.90 next. However, firm break of 178.80 will argue that deeper correction is already underway towards 55 D EMA (now at 177.09).

In the bigger picture, up trend from 114.42 (2020 low) is in progress and should target 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. Outlook will continue to stay bullish as long as 55 W EMA (now at 169.42) holds, even in case of deep pullback.

Daily Pivots: (S1) 0.8746; (P) 0.8758; (R1) 0.8770; More…

Intraday bias in EUR/GBP remains on the downside and outlook is unchanged. Sustained trading below 55 D EMA (now at 0.8744) will be an early sign of bearish trend reversal. Deeper fall should then be seen to 0.8631 cluster (38.2% retracement of 0.8221 to 0.8663 at 0.8618. However, break of 0.8816 minor resistance will bring stronger rebound to retest 0.8863 high instead.

In the bigger picture, rise from 0.8221 medium term bottom is still seen as a corrective move. Upside should be limited by 61.8% retracement of 0.9267 to 0.8221 at 0.8867. Sustained trading below 55 W EMA (now at 0.8588) should confirm that this corrective bounce has completed. However, decisive break of 0.8867 will suggest that EUR/GBP is already reversing whole decline from 0.9267 (2022 high). That should pave the way back to 0.9267.

Daily Pivots: (S1) 1.7725; (P) 1.7760; (R1) 1.7781; More...

EUR/AUD's break of 1.7739 supports suggests that rebound from 1.7561 has completed as a corrective move at 1.7976. Intraday bias is back on the downside for retesting 1.7561. For now, risk will stay on the downside as long as 1.7976 holds, in case of recovery.

In the bigger picture, price actions from 1.8554 medium term top are seen as a corrective pattern. Sustained break of 55 W EMA (now at 1.7426) will suggest that it's correcting the whole rally from 1.4281 (2022 low). In this case, deeper decline would be seen to 38.2% retracement of 1.4281 to 1.8554 at 1.6922. Nevertheless, strong rebound from 55 W EMA will likely bring resumption of the up trend sooner.

Daily Pivots: (S1) 0.9318; (P) 0.9332; (R1) 0.9345; More....

Intraday bias in EUR/CHF stays neutral and more consolidations could be seen below 0.9349. Fall from 0.9660 could have completed at 0.9178, on bullish convergence condition in D MACD. Above 0.9349 will resume the rise from 0.9178, and target 0.9452 resistance next. However, break of 0.9275 will turn bias back to the downside for 0.9178 low instead.

In the bigger picture, outlook remains bearish with EUR/CHF staying well inside long term falling channel after multiple rejection by 55 W EMA (now at 0.9377). Next target is 61.8% projection of 1.1149 to 0.9407 from 0.9928 at 0.8851. Break of 0.9452 resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will stay bearish in case of strong rebound.