Preliminary data released by Eurostat on January 7th showed that the Euro Zone’s inflation rate fell to 2.0% year-on-year in December 2025, lower than 2.1% in November, accurately meeting the European Central Bank’s inflation target, providing favorable conditions for regional economic policy adjustments. The decline in inflation was mainly driven by the slowing growth of energy prices and the easing of core inflationary pressures, and market expectations for subsequent monetary policy easing by the European Central Bank have heated up.

In terms of stock market performance, Germany’s Frankfurt DAX Index broke through the 25,000-point mark for the first time on the 7th, closing up 0.92% at 25,122.26 points, a record high. Analysts pointed out that the infrastructure investment plan launched by the German government has effectively boosted economic vitality, and coupled with the recovery of risk appetite in European and global markets, it has driven the strength of risky assets. However, the European economy still has hidden worries. Data from the German Federal Employment Agency shows that Germany’s unemployment rate rose to 6.3% in 2025, increasing for the third consecutive year, with the number of unemployed reaching 2.948 million.

In the foreign exchange market, the U.S. dollar index rose 0.11% to close at 98.683, and 1 euro was exchanged for 1.1682 U.S. dollars, a slight decline from the previous trading day. In addition, the Reserve Bank of India sold U.S. dollars on the 7th to support the rupee exchange rate, avoiding the exchange rate from breaking the 90 mark, and emerging market currencies generally face pressure from U.S. dollar fluctuations.