Investors are heading into the year-end with mixed signals of economic growth and market volatility.
The headline figures show a strong growth rate, but there are soft areas below the surface.
India’s central banks is burning reserves in Asia to stabilize the rupee. Nestle continues to shake up its corporate portfolio in Europe.
Gold and silver have been on an historic run, fuelled by geopolitics and rate cut bets.
US growth surges, cracks emerge
The US economy surged forward in the third-quarter, growing at an annualized rate of 4.3%, which is the highest growth for about two years, and far above the forecasted 3.3%.
Exports rebounded sharply from a collapse in Q2.
The government also contributes to the total.
What’s the silver lining? The business investment fell, indicating cracks under the surface. Corporate confidence was also waning.
After a delay, the report was released on Tuesday. It offers a cushion for 2026. However, there is still a noticeable softness in the labor market, which remains a major concern, as both hiring and unemployment have increased.
RBI launches a heavy-duty rupee defense
In October the RBI spent $11.88 billion, the most aggressive currency defense it has undertaken in almost a year to support the rupee, which was on the verge of breaching the 88.80 mark.
By the end of this month, forward positions had grown to $63.61 Billion.
After a relatively quiet start to the year, the rupee’s rapid fall was attributed by the RBI to FPI withdrawals and trade-deal jitters.
In December the currency already had a new record low, 91.075. This prompted even more aggressive intervention.
The RBI sold about $38 billion to defend the rupee in the past year, which is the highest amount of defense for the last three years. This shows how badly the currency was beaten.
Nestle completes Herta exit
Nestle has completed its exit of the Herta Charcuterie Business by selling its 40% remaining stake to Spanish Partner Casa Tarradellas. This ended a six-year partnership.
In 2019, the Swiss giant sold Casa Tarradellas 60% of its cold-cuts manufacturer for EUR690m, while keeping a minor stake. However, it never revealed terms regarding Tuesday’s sale.
This move is in line with the aggressive portfolio purge led by CEO Philipp Navratil, including scrapping of underperforming products and embracing meat-free alternatives to traditional meat.
Nestle is reviewing its water and vitamin businesses with a fresh strategic perspective, and has axed legacy brands which don’t align to the company’s health-focused shift.
Casa Tarradellas has now taken over Herta’s Charcuterie businesses across France, Germany and Belgium as well as the dough business in France and Belgium.
Silver and gold in the historic boom
The gold price soared past $4,494 per ounce, marking its 52nd best-ever close for the year. It has gained roughly 70% in value since January and is having its best year ever since the 1979 oil crisis.
Silver has also matched this momentum. It is now at an all time high of $70 per ounce, and it’s surging 141% so far in the year, crushing every other asset.
This twin rally was fueled by geopolitical tensions between the US and Venezuela, Russian blockades of Russian ships, and heightened demand for safe havens. Expectations that the Fed will cut rates next year, as well as weak dollar dynamics, also aided the rise.
JPMorgan predicts that the gold rally will continue to grow.
Analysts believe that the current momentum will continue into 2026, as physical silver supply is tightening while industrial demand remains robust.
Don’t get shocked by the volatility that comes with year-end.
The post Evening Digest: US Growth Surges, RBI Defends Rupee, Gold and Silver Near Record Highs will be updated as new information is released.
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