2025-12-28 22:38:00
TL;DR summary:
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European and US leaders report “good progress” in Ukraine peace discussions
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Trump reiterates talks are close, but admits key territorial issues remain
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Security guarantees largely agreed, though not yet finalised
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Europe stresses need for ironclad guarantees from day one
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Markets remain cautious about pricing a full peace dividend
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Momentum around Ukraine peace talks appeared to build further over the weekend, adding fresh colour to President Donald Trump’s earlier claim that negotiations are in the “final stages,” though markets will remain cautious about declaring a true geopolitical inflection point.
Following Trump’s comments after talks with Volodymyr Zelenskyy, European leaders confirmed a coordinated push to consolidate progress. European Commission President Ursula von der Leyen said she had held a one-hour call with Trump, Zelenskyy and several European leaders to discuss the latest peace negotiations, describing the talks as constructive and pointing to “good progress.”
Von der Leyen stressed that Europe is ready to continue working closely with Ukraine and the United States, while emphasising that any agreement must be underpinned by “ironclad” security guarantees from day one — language that mirrors Trump’s earlier promise of a “strong” security arrangement as part of any deal.
In London, a Downing Street spokesperson confirmed that UK Prime Minister Keir Starmer also participated in the discussions, with leaders commending Trump for progress achieved so far. The coordinated messaging suggests growing alignment among Western partners, at least on process, even as key substantive issues remain unresolved.
Trump himself struck an upbeat but qualified tone. He said negotiations were “getting a lot closer” following what he described as a “terrific” meeting with Zelenskyy, while acknowledging that one or two “thorny issues” remain — notably territorial questions, which he said were not yet resolved but could be settled. Trump suggested the outcome of the talks could become clearer within “a few weeks,” reinforcing the sense of urgency flagged in his earlier remarks.
On security guarantees, Zelenskyy said U.S.–Ukraine assurances were “100% agreed,” while Trump characterised them as 95% settled — a small but telling divergence that highlights how close, yet incomplete, the talks remain. Trump also said Russia would be involved in Ukraine’s reconstruction and claimed Washington would find ways to overcome President Vladimir Putin’s resistance to a ceasefire.
For markets, the narrative still resembles cautious optimism rather than a confirmed “peace dividend.” As highlighted in the earlier brief, the euro could benefit if investors begin to price in lower energy costs and a reduced geopolitical risk premium, while oil prices could remain under pressure. However, until concrete milestones — such as a scheduled in-person Trump-Putin meeting or a signed framework — emerge, investors are likely to treat the headlines as incremental progress rather than a decisive regime shift.
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Early EUR/USD trade has the pair not a lot changed from late Friday circa 1.1765 and thereabouts. Do be aware that at this time of year many professional traders are away from the market, leaving wholesale participation light.
Oil futures will reopen for the week at the top of the hour, 1800 US Eastern time. The same ‘light participation’ comments apply to Globex also.
