As at December 31, 2025
| Closing 31-12-25 |
Variation 30-11-25 |
Variation 31-12-24 |
|
|---|---|---|---|
| Key interest rate in Canada (%) | |||
| Key interest rate in Canada (%) | 2.25 | 0.00 | -1.00 ▼ |
| Oil (WTI) | |||
| Oil (WTI) | $57.42 | -1.9% ▼ | -19.9% ▼ |
| Gold | |||
| Gold | $4,319.37 | 1.9% ▲ | 64.6% ▲ |
| EUR/CAD | |||
| EUR/CAD | 1.61 | -0.7% ▼ | 7.5% ▲ |
| JPY/CAD | |||
| JPY/CAD | 0.01 | -2.4% ▼ | -4.8% ▼ |
| USD/CAD | |||
| USD/CAD | 1.37 | -2.0% ▼ | -4.9% ▼ |
Sources: Bank of Canada, Bloomberg Finance L.P.
CANADIAN MARKET
1.3% (S&P/TSX Composite 31-12-2025)The Canadian stock market wrapped up an outstanding year, posting a solid 1.3% gain for the month. Despite a pullback in the final trading session of 2025, the S&P/TSX Composite Index saw new highs throughout the year, recording an annual return of more than 30% and outperforming a number of other developed markets by a wide margin. December’s gain was part of a remarkable eight-month winning streak — a phenomenon not seen since 2017.
The Canadian market’s performance was driven mainly by the surge in gold and silver prices in response to heightened geopolitical tensions. Their momentum caused mining stocks to soar, with many almost doubling during the year. Sectors related to precious metals played a decisive role in the market’s outperformance, but large-cap financials also contributed significantly.
Even so, on the macroeconomic front, the signals were more mixed toward year-end, with data released in December confirming that the manufacturing sector had contracted for 11 months in a row. The weakness was due to pressures stemming from the uncertain international trade environment, specifically its impact on Canada.
As for the bond market, Government of Canada bond yields were up in December on revised expectations for central bank policies and pressure from U.S. bond markets. The higher yields weighed on bond prices, causing the FTSE Canada Universe Index to shed 1.28% on the month.
U.S. MARKET
-1.6% (S&P 500 31-12-2025 in CAD)In the United States, the stock market was down in December in Canadian-dollar terms, despite a slightly positive performance in the local currency. The S&P 500 Index fell 1.6% in Canadian dollars, mainly because of the stronger loonie.
This return comes in the context of a year-end when investors reduced their exposure to some technology stocks that had risen sharply in 2025, especially those related to artificial intelligence, after a euphoric year of high valuations.
Even so, the major U.S. indexes posted their third straight year of double-digit gains.
Expectations about the path of U.S. monetary policy also continued to play a key role. Hopes of further rate cuts in 2026 in light of more clear-cut economic data and the leadership transition at the Federal Reserve continued to influence the markets.
INTERNATIONAL MARKETS
1.3% (MSCI EAFE 31-12-2025 in CAD)During the month, international developed markets rose 1.3% in Canadian currency and 2.1% in local currencies on renewed interest in the European and Asian markets, as investors continued to diversify away from the United States. In Europe, the markets were buoyed by gradual disinflation, stabilization of monetary policy expectations and fiscal support measures, especially in Germany.
In the United Kingdon, the Bank of England delivered the year’s fourth 25-basis-point rate cut in December, while signalling that the pace of easing may be slowing. Its cautious stance helped support the stock market as financial conditions remained favourable.
In brief, global developed markets ended with their largest annual gains in several years.
EMERGING MARKETS
1.3% (MSCI Emerging Markets 31-12-2025 in CAD)Emerging markets had a positive return in December, rising 1.3% in Canadian dollars and 2.6% in local currencies. The gains were broad-based, supported not only by strength in technology and export-oriented sectors but also by a relatively favourable growth environment in a number of countries and the greenback’s weakness since the start of the year.
Attractive valuations and investor repositioning during the year also supported flows into emerging markets. This momentum enabled them to clearly outperform a number of developed markets during the year, confirming their relevance in a global economy in transition.
