Source: cnbc

The Canadian economy added jobs for a fourth consecutive month, but the biggest increase in the number of people looking for work in more than a year pushed the unemployment rate higher.

Employment rose by 8,200 in December, bringing cumulative job gains to 188,800 over the past four months, Statistics Canada reported Friday. The jobless rate jumped 0.3 percentage points to 6.8%.

Economists in a Bloomberg survey expected the economy to shed 2,500 positions, with an unemployment rate of 6.7%.

Gains were driven by an increase of 50,200 full-time jobs and growth in self-employment. Health care and social assistance added 20,800 positions, while the construction sector added 11,200 roles. Part-time employment fell by 42,000.

The labor force expanded by 81,000 in December, the most since November 2024 and led by increases in Ontario and Quebec — the country's two largest provinces. That brought the participation rate up to 65.4%.

The small job gains suggest the Canada's job market is holding firm even as US tariffs hit exports and investment. But the jump in the unemployment rate will raise questions about the extent to which labor market slack has been absorbed in recent months.

Even though many of the country's goods exports are exempt from US levies if they comply with the US-Mexico-Canada Agreement, there's still clear damage from the ongoing trade dispute.

In total, Canada's economy added 226,300 jobs from a year earlier, a 1.1% increase that was the weakest pace of employment growth in a calendar year since 2016, excluding the pandemic. Job vacancies also fell through most of the year, the agency said, pointing to weakened labor demand.

Total hours worked fell 0.3% in December from the previous month. Employment gains were highest in Quebec, while the western provinces of Alberta and Saskatchewan shed jobs.

Yearly wage growth for permanent employees decelerated to 3.7%. The unemployment rate for core- age workers, 25 to 54 years old, rose to 6%.

Source: Bloomberg Europe

Oil prices rose on Friday, driven by growing concerns over potential supply disruptions from Iran and new uncertainty surrounding Venezuela's oil sector.

By 1204 GMT, Brent futures increased by 59 cents, or 0.95%, to trade at $62.58 per barrel. U.S. West Texas Intermediate (WTI) crude saw a similar rise, climbing 54 cents, or 0.9%, to $58.30. The gains followed a more than 3% jump for both benchmarks on Thursday, reversing two consecutive days of declines. For the week, Brent is positioned for a 3% increase, while WTI is on track for a 1.7% gain.

US Eyes Control of Venezuelan Oil Sector

Market attention is sharpening on Venezuela after the White House scheduled a meeting with oil companies and trading houses on Friday to discuss the country's export deals. The meeting follows the capture of Venezuelan President Nicolas Maduro and a subsequent demand from President Trump for the U.S. to gain full access to the nation's oil industry.

According to U.S. officials, Washington intends to control Venezuela's oil sales and revenues indefinitely. Major industry players, including Chevron Corp, Vitol, and Trafigura, are reportedly competing for U.S. government contracts to market up to 50 million barrels of crude oil. This oil has been accumulated in inventories by state-run company PDVSA during a severe embargo that involved four tanker seizures.

"The market will focus on the outcome in the coming days for how the Venezuelan oil in storage will be sold and delivered," noted Tina Teng, a market strategist at Moomoo ANZ.

Iran and Ukraine Conflicts Add to Jitters

Adding to supply-side anxiety is the escalating civil unrest in Iran, a major Middle Eastern oil producer. "Iran protests seem to be gathering momentum, leading the market to worry about disruptions," said Ole Hansen, head of commodity analysis at Saxo Bank. Protests over economic hardships have been reported in Tehran, Mashhad, Isfahan, and other areas, with internet monitoring group NetBlocks confirming a nationwide internet blackout on Thursday.

Meanwhile, the ongoing Russia-Ukraine war continues to fuel supply worries. Russia’s military announced on Friday that it had fired its Oreshnik hypersonic missile at targets in Ukraine. The Russian defense ministry stated that the targets included energy infrastructure that supports Ukraine's military-industrial complex.

Rising Inventories Could Cap Price Gains

Despite the bullish geopolitical factors, some analysts warn that a global oversupply could limit further price increases. According to Haitong Futures, global oil inventories are rising, and this oversupply remains the primary driver that could cap gains.

The firm suggested that unless the risks surrounding Iran escalate significantly, the current rebound in oil prices is likely to be limited and difficult to sustain.

The European Union's landmark free trade agreement with the Mercosur bloc of South American nations has cleared a major hurdle, moving one step closer to ratification despite significant internal division.

Representatives in Brussels confirmed on Friday that a qualified majority of the EU's 27 member states, representing at least 65% of the bloc's population, have approved the proposal. This green light could allow European Commission President Ursula von der Leyen to sign the agreement with Brazil, Paraguay, Argentina, and Uruguay as early as next week.

However, the pact's journey is not over. It must still secure final approval from the European Parliament before it can officially take effect.

A Divided Bloc: France and Germany at Odds

While the agreement secured the necessary votes to proceed, it has exposed deep rifts within the EU, most notably between its two largest economies.

France Leads the Opposition

French President Emmanuel Macron has been a vocal opponent, confirming late Thursday that his country would not support the treaty. He stated that France's political establishment was "unanimous" in its rejection.

"France is favorable to international trade, but the EU-Mercosur agreement is an agreement from another age, negotiated for too long on bases that are too outdated," Macron explained in a post on X.

This resistance from key members, including France, Italy, and Poland, had already forced the postponement of a planned signing in Brazil last December.

Germany Champions the Deal

In sharp contrast, Germany has consistently championed the agreement as a vital strategic and economic move. Berlin views the pact as a critical tool to open new markets for its export-driven economy, which has been struggling with stagnation.

"The approval of the EU-Mercosur Agreement is a milestone in European trade policy and an important signal of our strategic sovereignty and capacity to act," said Chancellor Friedrich Merz.

Finance Minister Lars Klingbeil echoed this sentiment, framing the deal as a timely victory for free trade. "While others are closing themselves off and pursuing increasingly aggressive trade policies, we are focusing on new partnerships," he said, referencing protectionist policies like Donald Trump's "America First" agenda.

German business groups have also celebrated the progress. The country's VDA auto industry association called the approval "long overdue and very good news... especially for Germany as an exporting country."

What the Agreement Aims to Achieve

If ratified, the EU-Mercosur pact would create one of the world's largest free trade zones. Its primary objectives include:

• Tariff Removal: Eliminating import tariffs on over 90% of products traded between the two blocs.

• Economic Savings: Saving EU businesses billions in duties each year.

• Export Growth: Boosting EU exports of vehicles, machinery, wines, and spirits to Latin America.

• Trade Diversification: Providing an alternative to reliance on markets impacted by US tariffs and Chinese competition.

"This is the biggest free trade agreement we have negotiated," EU trade chief Maros Sefcovic noted on Wednesday.

Brazilian President Luiz Inacio Lula da Silva highlighted its geopolitical significance in December, stating, "We have in our hands the opportunity to send the world an important message in defense of multilateralism."

Backlash on the Streets: Farmers Protest Across Europe

Despite strong support from governments like Germany and Spain, the agreement faces fierce opposition from a key sector: agriculture.

French farmers used tractors to protest the EU-Mercosur agreement near the Arc de Triomphe in Paris, expressing fears of unfair competition.

Farmers across the EU have voiced concerns that the deal will undercut their businesses by flooding the market with cheaper agricultural imports from South America. These fears have fueled widespread protests, with farmers taking to the streets with their tractors on Thursday to block major routes in Paris and parts of Germany.

China's cabinet has announced a new package of fiscal and financial policies designed to stimulate domestic demand, signaling a concerted effort to fortify the economy for a strong start in 2026.

According to state broadcaster CCTV, a meeting chaired by Premier Li Qiang outlined a series of initiatives focused on spurring household consumption and private investment. Officials described the coordinated policy package as a crucial measure for expanding effective demand and innovating macroeconomic management.

Fueling Household Consumption

A primary goal of the new policies is to directly encourage consumer spending. The government plans to achieve this through several key channels:

• Enhanced Loan Support: Financial backing for service providers will be strengthened to improve their offerings to consumers.

• Interest Subsidies: Policies providing interest subsidies for personal consumer loans will be enhanced to make borrowing more attractive.

• Improved Services: The supply of high-quality consumer services will be expanded.

This strategy builds on a recent 62.5 billion yuan allocation from special treasury bonds to fund a 2026 consumer trade-in program. That scheme offers subsidies for households replacing old home appliances and purchasing new energy vehicles.

Mobilizing Private Sector Investment

The government also intends to guide more private capital toward consumption and investment initiatives. To support this objective, China will roll out a series of targeted financial tools:

• Support for Small Firms: Interest-subsidy policies will be introduced for loans to small businesses.

• Guarantees for Private Investment: A special guarantee program will be established to back private investment projects.

• Risk-Sharing for Corporate Bonds: A risk-sharing mechanism will be created for bonds issued by private companies to improve their access to capital markets.

Lowering Costs for Business Upgrades

In addition to supporting new investment, the plan includes measures to help existing enterprises. The government will fine-tune interest-subsidy policies for equipment-upgrade loans, aiming to reduce financing thresholds and lower borrowing costs for businesses looking to modernize.

President Donald Trump is meeting with executives from 17 top energy firms to detail his plan for rebuilding Venezuela's collapsed oil industry, a project he claims could drive over $100 billion in new investment.

In a Friday post on social media, Trump announced, "At least 100 Billion Dollars will be invested by BIG OIL, all of whom I will be meeting with today at The White House." The meeting aims to secure support from American oil companies to spearhead the redevelopment of Venezuela's energy infrastructure.

A Who's Who of Energy Giants

The White House guest list represents a broad cross-section of the global energy market, from producers to refiners and traders. According to an official, attendees include:

• US Oil Majors: Chevron Corp., Exxon Mobil Corp., and ConocoPhillips.

• Independent Producers: Continental Resources Inc. and Hilcorp Energy Co.

• International Firms: Shell Plc, Spain's Repsol SA, and Italy's Eni SpA.

• Oilfield Services & Refining: Halliburton Co., Valero Energy Corp., and Marathon Petroleum Corp.

• Commodity Traders: Trafigura Group and Vitol Americas.

Other confirmed companies include HKN Inc., Tallgrass Energy, Raisa Energy, and Aspect Holdings. Key administration officials joining the session are Energy Secretary Chris Wright, Secretary of State Marco Rubio, and Interior Secretary Doug Burgum.

Reviving a Crippled Industry

The administration's goal is to reverse the decline of Venezuela's oil sector. Despite holding the world's largest proven crude reserves, the nation's output has fallen to under 1 million barrels per day, a shadow of its 1970s peak of nearly 4 million barrels daily. Decades of neglect and the departure of foreign operators have left the industry in disrepair.

"Following the announcement of President Trump's historic energy deal with Venezuela, American oil companies will come to the White House to discuss investment opportunities that will restore Venezuelan oil infrastructure," said White House spokeswoman Taylor Rogers. "The American people, energy companies, and the Venezuelan people will all greatly benefit from these new, unprecedented investments."

Enthusiasm Tempered by Security Concerns

While energy executives are supportive of the plan's economic potential, they remain cautious. A primary concern is the lack of physical and financial security guarantees in Venezuela, particularly following the apprehension of former President Nicolás Maduro by U.S. troops. Industry leaders are hesitant to commit to major investments without assurances of stability.

Meanwhile, the administration's plan is already making waves in the market, as preparations begin to sell off Venezuelan crude that has accumulated in storage during a U.S. naval blockade.

Trump's Deep Ties to the Oil Industry

President Trump has consistently enjoyed strong backing from the oil and gas sector, which was a major financial contributor to his reelection campaign. Key supporters include Jeff Hildebrand of Hilcorp and Continental co-founder Harold Hamm.

This meeting follows a closed-door energy roundtable at Trump's Mar-a-Lago club in April 2024. During that event, the then-presidential candidate criticized wind power, promised to reverse environmental regulations, and asked the assembled executives to raise $1 billion for his campaign.