Summary:China December exports and imports beat forecastsExports +6.6% y/y; imports +5.7% y/y in dollar termsDecember trade surplus $114.1bn2025 trade surplus hits $1.19tn on flat importsUS bilateral surplus eases slightly in DecemberChina closed 2025 with a stronger-than-expected trade performance, as December exports and imports both beat forecasts, underscoring the economy’s continued reliance on external demand even as domestic momentum remains uneven.Customs data showed December dollar-denominated exports rose 6.6% y/y, well above the Reuters poll forecast of 3.0% and slightly stronger than November’s 5.9% pace. Imports increased 5.7% y/y, sharply beating expectations for a modest 0.9% rise and accelerating from a 1.9% gain previously. As a result, China recorded a December trade surplus of $114.1 billion, marginally above the $113.6 billion consensus.In yuan terms, exports rose 5.2% y/y in December, while imports climbed 4.4% y/y, producing a trade surplus of CNY 808.8 billion. The divergence between dollar- and yuan-denominated figures reflects currency effects over the period but does not materially change the underlying picture of firm trade flows at year-end.For full-year 2025, China’s export performance remained resilient. Dollar-denominated exports rose 5.5% y/y, while imports were flat year-on-year, resulting in a record trade surplus of $1.189 trillion. In yuan terms, exports increased 6.1% y/y and imports edged up 0.5% y/y, with the annual trade surplus reaching CNY 8.51 trillion.The data highlight how China’s growth model continues to lean heavily on exports amid subdued domestic demand, particularly in consumption and private investment. Strong overseas shipments have been supported by competitive pricing, supply-chain dominance in manufactured goods, and continued redirection of exports toward non-U.S. markets as trade frictions persist.China’s December trade surplus with the United States narrowed slightly to $23.25 billion, from $23.74 billion in November. While the bilateral balance remains large, the modest easing suggests some rebalancing at the margin, even as trade tensions and tariff uncertainty continue to shape export patterns.Overall, the latest trade figures reinforce the view that China’s external sector remains a key stabiliser for growth heading into 2026. However, the scale of the surplus also risks intensifying trade scrutiny from major partners at a time when global protectionist pressures are rising. This article was written by Eamonn Sheridan at investinglive.com.

Summary:BOJ market operations meetings are technical, not policy-settingFocus is on bond buying and liquidity mechanicsSmall tweaks can still send strong market signalsOften used to prepare markets ahead of policy shiftsCan move JGBs, yen and equities The Financial Markets Department of the Bank of Japan will hold the “meeting on market operations” on February 26, 2026 the meeting on market operations will discuss recent market developments, BOJ operations, JGB market liquidity and functionality, money markets I wouldn't read too much into this. I think its significant for the fact that the news of the meeting is hitting headlines at this time of rapid yen weakening. But ... its not until February 26! We could be at 200 by then! I exaggerate ... but we could be much higher and Japanese officials are already on edge, if they decide to act on some sort of actual intervention they won't wait another six weeks just to get this meeting out the way. --A Bank of Japan (BOJ) meeting on market operations is a technical but closely watched event that focuses on how monetary policy is implemented in financial markets, rather than the direction of policy itself.Unlike a formal BOJ policy meeting — where interest rates, yield targets or guidance are debated — a market operations meeting concentrates on the mechanics of liquidity provision. These sessions review the BOJ’s bond-buying framework, including the size, frequency and maturity buckets of Japanese government bond (JGB) purchases, as well as money-market operations such as repo facilities and collateral terms.The stated aim is to ensure smooth market functioning and effective policy transmission. In practice, however, even modest operational adjustments can carry meaningful market signals. Changes to purchase amounts at specific maturities, for example, can influence yield curves, affect bank and insurer balance sheets, and alter expectations around the BOJ’s tolerance for higher long-term rates.Markets pay particular attention because, in Japan, operational tweaks have often preceded broader policy shifts. Reducing bond purchases or increasing flexibility around operations can be interpreted as a form of “backdoor tightening,” even if the BOJ insists its overall policy stance is unchanged. As a result, these meetings can move the yen, JGB yields and equities despite their technical framing.Topics typically discussed include liquidity conditions in the JGB market, volatility at specific tenors such as the 10-year or super-long end, distortions created by sustained BOJ buying, and the impact of operations on financial institutions. Outcomes may include fine-tuning purchase schedules, adjusting the balance across maturities, or modifying repo and collateral arrangements.Importantly, a market operations meeting does not signal an imminent rate hike or policy pivot by default. But in a system where the BOJ remains a dominant market participant, changes to the “plumbing” can still shape expectations about the future path of policy.For investors, the distinction matters: while these meetings are not about tightening or easing per se, they can quietly redefine the contours of Japan’s monetary framework and influence asset prices well ahead of any formal announcement. This article was written by Eamonn Sheridan at investinglive.com.

Full year data out from China. 2025 yuan-denominated:Exports +6.1% y/y Imports +0.5% y/y Two-way trade value at 45.47 trln yuan, +3.8% y/y. A record high. Of more interest is the December trade trade, yet to re released. I'll post separately. ADDED: Here it is. This article was written by Eamonn Sheridan at investinglive.com.

Summary:World Bank lifts global growth forecasts for 2025–26Global GDP seen at 2.6% in 2026, 2.7% in 2027US resilience drives bulk of upward revisionEmerging market growth remains structurally weak2020s shaping up as weakest growth decade since 1960sThe global economy is showing greater resilience than previously expected, but growth remains too uneven and too weak to meaningfully reduce poverty or lift long-term living standards, according to the latest Global Economic Prospects report from the World Bank.In its semi-annual assessment, the World Bank said global GDP growth is forecast to slow modestly to 2.6% in 2026 from 2.7% in 2025, before edging back up to 2.7% in 2027. While the headline profile remains subdued, the Bank upgraded its 2026 growth forecast by 0.2 percentage points from its June outlook, and lifted its 2025 estimate by 0.4 percentage points, citing stronger-than-expected performance in advanced economies.Around two-thirds of the upward revision reflects resilience in the United States, despite ongoing tariff-related trade disruptions. The Bank expects U.S. growth to rise to 2.2% in 2026, from 2.1% in 2025, with both figures revised higher from June. It said an early surge in imports to front-run tariffs weighed on growth in 2025, but larger tax incentives are expected to support activity in 2026, partially offsetting the drag from tariffs on investment and consumption.Despite the improved near-term outlook, the World Bank warned the global economy is on track for its weakest decade of growth since the 1960s, a pace insufficient to prevent stagnation, joblessness and rising vulnerability across emerging markets.“With each passing year, the global economy has become less capable of generating growth and seemingly more resilient to policy uncertainty,” said the World Bank's chief ​economist. He cautioned that resilience and dynamism cannot diverge indefinitely without placing strain on public finances and credit markets.Growth in emerging market and developing economies is forecast to slow to 4.0% in 2026 from 4.2% in 2025, though both projections were revised modestly higher. Excluding China, growth in this group is expected to stagnate at 3.7%, unchanged from 2025.China’s growth is seen easing to 4.4% in 2026 from 4.9%, though both figures were revised up from June, reflecting fiscal stimulus and stronger exports to non-U.S. markets.Overall, the report paints a picture of a global economy that is holding up better than feared, but increasingly reliant on a narrow set of growth engines. This article was written by Eamonn Sheridan at investinglive.com.

The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a "band," around a central reference rate, or "midpoint." It's currently at +/- 2%.The previous close was 6.9795PBOC injects 240.8bn yuan through 7-day reverse repos at an unchanged rate of 1.4%. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Japan stocks extend rally on snap election speculationNikkei breaks above 54,000 for first timeMarkets price fiscal stimulus and stopgap budget riskYen weakens past 159, lowest since July 2024FX jawboning fails to slow equity-yen dynamicJapanese equities extended their rally on Wednesday, pushing further into record territory as speculation mounted that Prime Minister Sanae Takaichi may call a snap lower house election, reinforcing expectations of looser fiscal policy and prolonged yen weakness.According to the Yomiuri newspaper, Takaichi is considering dissolving parliament next week and holding an election on February 8. If confirmed, it would mark her first time facing voters since taking office in October. The report said the fiscal 2026 budget would be unlikely to pass before the end of the current fiscal year in March, raising the prospect of a stopgap budget as the government moves to roll out inflation countermeasures as early as possible.Markets have interpreted the prospect of an early election as fiscal-positive. Japanese stocks surged for a second straight session, with the Nikkei 225 rising as much as 1% on Wednesday to break above the 54,000 level for the first time, following a more than 3% gain the previous session. The broader Topix also extended record highs, adding around 0.6%.The rally has been reinforced by a persistently weak currency. The yen slipped past 159 per dollar, marking its weakest level since July 2024, when Japanese authorities last intervened to halt rapid depreciation. The softer yen continues to support exporter earnings expectations, amplifying equity gains even as officials express concern over one-sided FX moves.Recent verbal intervention from Japanese officials has so far failed to deliver a sustained yen rebound, and markets appear to be prioritising rate differentials and fiscal expectations over rhetoric. With no clear signal of imminent action from authorities, currency weakness remains a tailwind for stocks.For investors, the emerging narrative is familiar: election-driven stimulus expectations, a soft yen, and resilient global risk appetite are combining to propel Japanese equities higher, even as FX stress builds in the background. This article was written by Eamonn Sheridan at investinglive.com.

The People’s Bank of China is due to set the daily USD/CNY reference rate at around 0115 GMT (2115 US Eastern time), a fixing that remains one of the most closely watched signals in Asian foreign exchange markets. China operates a managed floating exchange rate system, under which the renminbi (yuan) is allowed to trade within a prescribed band around a central reference rate, or midpoint, set each trading day by the PBOC. The current trading band permits the currency to move plus or minus 2% from the official midpoint during onshore trading hours. Each morning, the PBOC determines the midpoint based on a range of inputs. These include the previous day’s closing price, movements in major currencies, particularly the US dollar, broader international FX conditions, and domestic economic considerations such as capital flows, growth momentum and financial stability objectives. The midpoint is not a purely mechanical calculation, allowing policymakers discretion to guide market expectations. Once the midpoint is announced, onshore USD/CNY is free to trade within the allowable band. If market pressures push the yuan toward either edge of that range, the central bank may step in to smooth volatility. Intervention can take the form of direct buying or selling of yuan, adjustments to liquidity conditions, or guidance through state-owned banks. As a result, the daily fixing is often interpreted as a policy signal rather than just a technical reference point. A stronger-than-expected CNY midpoint is typically read as a sign the PBOC is leaning against depreciation pressure, while a weaker fixing for the CNY can indicate tolerance for a softer currency, often in response to dollar strength or domestic economic headwinds.In periods of heightened global volatility, such as shifts in US rate expectations, trade tensions or capital flow pressures, the fixing takes on added significance. For investors, it provides insight into Beijing’s currency priorities, balancing competitiveness, capital stability and financial market confidence. This article was written by Eamonn Sheridan at investinglive.com.

Summary:ANZ world commodity index down 2.1% m/m in DecemberDairy prices slide 5.3%; butter plunges 16.9%Meat and wool prices hit record for fourth monthStrong NZD drags local currency index lowerCommodity mix softens as NZ recovery beginsNew Zealand’s commodity price pulse weakened further in December, with falling dairy prices again outweighing strength in meat and wool, according to the latest ANZ commodity price data.The ANZ World Commodity Price Index fell 2.1% month on month in December, driven by a 5.3% m/m decline in dairy prices. ANZ said global dairy markets continue to face heavy pressure from strong milk production growth across most major exporting countries, with butter prices experiencing the sharpest adjustment. Butter prices slumped 16.9% m/m, underscoring the scale of oversupply in that segment.In contrast, the meat and wool world price index rose 1.2% m/m, extending gains for a fourth consecutive month and reaching a fresh record high. Tight supply conditions in the U.S. beef market have been the dominant driver, while lamb and wool prices have also benefited from supportive demand and constrained availability. Despite the strength in meat and fibre, the broader world price index has rolled over since peaking in May and is now 2.4% lower year on year across 2025.The picture was more challenging in local currency terms. The NZD Commodity Price Index fell 3.9% m/m in December, as a firmer New Zealand dollar amplified the decline in global prices when converted into NZD. While the NZD strengthened late in the year, ANZ noted that the currency weakened overall through 2025, helping local prices outperform global benchmarks over a longer horizon. As a result, the NZD index is down 1.5% y/y, a smaller decline than the 2.4% y/y fall in the world price index.The divergence across commodity groups comes as New Zealand’s domestic economy shows early signs of recovery. Recent business surveys point to improving confidence, firmer hiring and stabilising activity as lower interest rates begin to flow through. While ongoing dairy weakness remains a headwind for rural incomes, resilience in meat and wool prices, combined with a broader economic lift, should help cushion the impact on growth into early 2026. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Reuters: drones hit two tankers in Black SeaShips were bound for terminal loading most Kazakh crudeKazakhstan output down ~35% Jan 1–12 on constraintsCPC exports continue via one mooring after prior damageWar-risk insurance costs nearly doubled after strikesReuters reported that drones struck two oil tankers in the Black Sea on Tuesday as they sailed toward a key Russian-coast terminal that handles the bulk of Kazakhstan’s crude exports, underscoring rising security risks for energy flows through the region and adding fresh uncertainty to global supply.According to Reuters, the vessels were heading to the Yuzhnaya Ozereyevka terminal near Novorossiysk, a loading point for roughly 80% of Kazakh oil shipped to international markets, as well as some Russian crude. One of the tankers was chartered by Chevron, which said all crew were safe, the vessel remained stable, and it was proceeding to a safe port while the company coordinated with the operator and authorities.The strikes come against a backdrop of sharply reduced Kazakh output. Reuters cited a source familiar with the data saying Kazakhstan’s oil and gas condensate production fell about 35% between January 1 and January 12 versus December’s average, largely due to export constraints via the Caspian Pipeline Consortium (CPC) route. Kazakhstan’s energy ministry said CPC continued exporting via one mooring, highlighting reduced operational flexibility after earlier damage.Reuters noted the terminal itself previously came under attack on November 29, when a Ukrainian drone hit one of CPC’s three main moorings. Kyiv has targeted Russian energy infrastructure to pressure Moscow over the war in Ukraine, although it was not immediately clear who was behind Tuesday’s tanker strikes. Ukraine did not comment, and CPC declined to comment, Reuters said.The incident also reverberated through shipping markets. Reuters reported that war-risk insurance costs for ships sailing to the Black Sea nearly doubled following the attacks, raising transportation costs and potentially discouraging some operators. Russian Black Sea terminals handle more than 2% of global crude, and the waterway is also critical for grain shipments, meaning any escalation can have broader commodity-market implications beyond oil.Company statements cited by Reuters indicated both affected vessels suffered limited damage, fires (where reported) were quickly extinguished, and there were no reports of pollution, yet the episode reinforces the fragility of export infrastructure and the risk premium embedded in Black Sea energy logistics. ---The attacks add a near-term risk premium to Black Sea crude flows by lifting war-risk insurance costs, increasing voyage uncertainty and raising the hurdle rate for tanker availability. Even without sustained physical damage, higher costs and operational caution can slow loadings and tighten prompt supply, particularly for CPC-linked grades.More structurally, the reliance on a reduced number of functioning moorings at the CPC terminal leaves Kazakh exports vulnerable to further disruption. With Kazakhstan’s output already down sharply, any additional outage, whether from security incidents, weather or maintenance, could temporarily remove meaningful barrels from the seaborne market, amplifying price sensitivity despite what otherwise seems to be ample global supply. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Barkin downplays importance of any single Fed meetingSays policy mistakes can be corrected over timeCPI data seen as encouragingShelter inflation still distorted by data gapsTariffs remain longer-term inflation riskRichmond Federal Reserve President Tom Barkin struck a pragmatic tone on monetary policy decision-making on Tuesday, playing down the importance of any single Fed meeting and pointing to encouraging inflation data alongside lingering tariff-related cost risks.Speaking after earlier remarks defending central bank independence and highlighting stable macro conditions, Barkin said no individual policy meeting is decisive, noting that the Federal Reserve can adjust course if needed. “No one meeting matters that much,” he said, adding that if policymakers “get it wrong,” they retain the ability to correct at subsequent meetings, a signal of confidence in the Fed’s gradual, data-dependent approach.On inflation, Barkin said the latest consumer price data was “encouraging,” reinforcing the view that price pressures are not re-accelerating. However, he cautioned that some inflation components remain difficult to assess in real time. In particular, Barkin said shelter inflation continues to be biased by incomplete data, citing the absence of October inputs as a distortion that complicates interpretation of underlying trends.Barkin also offered updated colour on how businesses are responding to trade policy uncertainty. He said firms now appear to have greater confidence in understanding the likely outcomes of tariff policy compared with last April, suggesting that uncertainty around trade measures has eased somewhat even if costs have not disappeared.That said, Barkin warned tariffs remain a source of inflationary pressure over time. While the timing and magnitude of those effects remain unclear, he said there is still some residual cost pressure working its way through supply chains, reinforcing the need for caution when assessing the medium-term inflation outlook.Taken together, Barkin’s comments reinforce the Fed’s broader message of flexibility and patience: inflation appears to be cooling, businesses are adapting to policy uncertainty, and policymakers see room to adjust without overreacting to any single data point or meeting. This article was written by Eamonn Sheridan at investinglive.com.

Bitcoin above USD94,725, best for beleaguered crypto since 17 November last year. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Reuters Tankan shows manufacturers’ mood slips to six-month lowManufacturing index falls to +7 from +10 in DecemberMaterials sectors (oil/ceramics, steel, chemicals) lead declinesNon-manufacturers dip slightly to +32 from +33April outlook diverges: manufacturers improve, services worsenJapanese business sentiment softened at the start of the year, with manufacturers’ confidence slipping to a six-month low in January as weaker demand from major economies weighed on materials-heavy sectors, according to the latest Reuters Tankan poll.The monthly survey, which tracks the Bank of Japan’s closely watched quarterly tankan, showed the manufacturers’ sentiment index fell to +7 in January from +10 in December, marking a second consecutive decline while remaining in positive territory. The index is calculated as the share of optimistic responses minus pessimistic ones, meaning readings above zero still indicate net optimism.The pullback was most pronounced in materials industries. The oil and ceramics sector recorded one of the steepest drops, falling sharply to zero, while steel sentiment deteriorated further into deeply negative territory and chemicals confidence also eased. Companies cited lacklustre demand conditions across key export markets, with one steelmaker pointing to weaker Chinese orders for automotive-linked goods. Others flagged softer consumer spending in the U.S. and China, while some manufacturers pointed to the drag from tariffs on exports.By contrast, the auto and electronic machinery sectors saw only modest declines, suggesting parts of Japan’s industrial base are holding up better than materials producers exposed to the global cycle.Sentiment among non-manufacturers edged slightly lower, with the index slipping to +32 from +33. The decline was led by wholesalers and retailers, though other areas such as information services, transport and real estate improved. Some service-sector firms also referenced a fall in Chinese tourism linked to a bilateral diplomatic row, with one department store manager reporting a sharp drop in foreign tourist sales. Others, however, said the broader inbound demand backdrop remained resilient.Looking ahead, companies see a divergence in momentum. Manufacturers expect sentiment to improve to +10 by April, while non-manufacturers anticipate conditions deteriorating to +26, pointing to rising caution in the services economy even as factories look for a cyclical rebound.For the Bank of Japan, the results underscore a mixed picture: manufacturing is still positive but losing steam, while domestic-facing sectors remain supported yet increasingly vulnerable to trade and tourism shocks.---With a weak yen, be careful of intervention risk:USD/JPY is surging still. Do we pencil in January 19 for Bank of Japan intervention? This article was written by Eamonn Sheridan at investinglive.com.

Summary:US eases H200 export rules to case-by-case reviewThird-party testing and supply certifications requiredShift from blanket denial to conditional pathwayChina signals purchases only in “special circumstances”Nvidia shares edge higher, uncertainty remainsThe United States has taken a calibrated step toward easing export restrictions on advanced AI semiconductors, revising licensing rules to potentially allow shipments of Nvidia’s H200 chips to China under tightly controlled conditions.A final rule published by the Bureau of Industry and Security at the Department of Commerce shifts policy from a blanket presumption of denial to a case-by-case license review for certain advanced computing commodities exported to China and Macau. The rule covers Nvidia’s H200 and equivalent chips, as well as some less-advanced products, subject to strict verification requirements.Before any exports can proceed, shipments must undergo independent third-party testing in the United States to confirm technical AI performance characteristics. Exporters must also certify that there is sufficient domestic supply of the chips, that production for China will not divert foundry capacity away from U.S. end-users, and that recipients have demonstrated adequate security procedures.The change marks a notable adjustment in Washington’s approach to AI chip controls, creating a narrow pathway for exports while preserving safeguards designed to prevent technology diversion. The Commerce Department emphasised that the rule does not represent a broad reopening, but rather a more targeted licensing framework with multiple checkpoints.Markets read the move as modestly supportive for Nvidia, with shares rising about 0.5% on the day. However, the upside was capped by signals from China that access to H200 chips will be approved only under “special circumstances,” including limited use cases such as university research. Officials have yet to define the criteria, leaving demand uncertain.The result is a policy tug-of-war: Washington outlines a conditional route for exports, while Beijing signals selective gatekeeping on the buyer side. For Nvidia and the broader AI chip sector, the development reduces outright downside risk but keeps shipment volumes, timing, and revenue contribution highly uncertain. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Barkin says central bank independence delivers better outcomesDeclines comment on political pressure facing the FedInflation above target but not acceleratingUnemployment ticking up but remains containedBusinesses showing less appetite to pass through pricesRichmond Federal Reserve President Tom Barkin reinforced the importance of central bank independence on Tuesday, saying countries that safeguard monetary policy autonomy tend to achieve better economic outcomes, as political pressure on the U.S. Federal Reserve remains in focus.Speaking in remarks reported by Reuters, Barkin declined to comment directly on recent political developments surrounding the Fed, referring instead to “stuff that’s been in the news.” His comments came after the Trump administration threatened potential legal action against Fed Chair Jerome Powell, an episode Powell has described as intimidation aimed at influencing monetary policy.While avoiding the political controversy, Barkin said the economic evidence is clear that independent central banks deliver stronger and more stable outcomes. His remarks add to a growing chorus of Fed and other global central bank officials publicly defending institutional credibility and policy autonomy.On the economic outlook, Barkin struck a measured tone. He said U.S. inflation remains above the Federal Reserve’s 2% target but does not currently appear to be accelerating, suggesting price pressures are easing gradually rather than re-intensifying. He also noted that unemployment has ticked higher but does not appear to be moving “out of control,” indicating continued resilience in the labour market.Barkin highlighted a shift in business behaviour compared with early 2025. Unlike the first quarter of last year, he said he is no longer hearing strong conviction among businesses about passing higher costs through to consumers via price increases. That observation points to reduced pricing power and supports the view that inflation pressures may continue to cool without further aggressive policy tightening.Taken together, Barkin’s comments reinforce the Federal Reserve’s prevailing message that monetary policy is well positioned, with inflation gradually easing and labour market risks contained. They also underscore a broader institutional stance: that maintaining central bank independence is critical not just for credibility, but for sustaining favourable long-term economic outcomes. This article was written by Eamonn Sheridan at investinglive.com.

Via oilprice.com---Expectations I had seen centred on:Headline crude +0.42 mn barrelsDistillates +0.13 mn bblsGasoline +0.24 mnThis data point is from a privately-conducted survey by the American Petroleum Institute (API).It's a survey of oil storage facilities and companiesThe official report is due Wednesday morning US time.The two reports are quite different.The official government data comes from the US Energy Information Administration (EIA)Its based on data from the Department of Energy and other government agenciesWhereas information on total crude oil storage levels and variations from the previous week's levels are both provided by the API report, the EIA report also provides statistics on inputs and outputs from refineries, as well as other significant indicators of the status of the oil market, and storage levels for various grades of crude oil, such as light, medium, and heavy.the EIA report is held to be more accurate and comprehensive than the survey from the APII posted yesterday on the tug of war in oil:Oil rises as geopolitics clash with new supply; Iran tensions vs. Venezuela exportsIn brief:Oil settles at seven-week highs, extending mid-January rallyIran export risks support prices amid protest crackdownVenezuela supply return caps upsideRussia, Azerbaijan add background supply riskVolatility dominates despite surplus outlookOil climbed as Iran-related supply risks outweighed expectations of returning Venezuelan barrels, gains seen since mid-last week.SO far the tensions surrounding Iran are winning out, supporting oil prices. In the chart at the top of this post I added a 'resistance' line based on just an eyeballing of the daily candles cahrt. I suspect that, at the lest, we'll have some price work to do before it can head too much higher. If Trump launches an attack against Iran, which seems likely given he going backwards on domestic policy and popularity (attacking someone is about all he is able to get done right now), that should be enough for a renewed pop higher. This article was written by Eamonn Sheridan at investinglive.com.

The U.S. dollar is pushing higher, led by USDJPY, which is up 0.55% and once again setting the tone for the broader FX market. In the video above, I walk through the technical picture for USDJPY, GBPUSD, USDCHF, and AUDUSD, focusing on bias, risk, and targets.USDJPYUSDJPY is making another run above the January 2025 high at 158.86, extending beyond the key swing zone between 158.55 and 158.86. Earlier today, the market successfully tested the lower edge of that zone, giving buyers the green light to push higher.That swing area now becomes the risk level for longs — stay above it and the bias remains bullish; move below it and buyers lose control. If price continues higher, the next upside target comes in near the psychological 160.00 level.GBPUSDGBPUSD has slipped back below both the 200-hour moving average at 1.3465 and the 100-hour moving average at 1.3444, shifting short-term momentum back toward the sellers.As long as price stays below the 100-hour MA, downside risk remains. A more conservative risk level for shorts is the 200-hour MA. On the downside, the next target sits in the 1.3391 to 1.3404 swing zone, which is reinforced by the 200-day moving average at 1.3390, making this a high-interest support area.USDCHFUSDCHF has pushed to a new short-term high, testing resistance near 0.8017, the highs from both yesterday and Friday. A sustained break above this level opens the door toward the 0.8047 trendline, taking price to its highest levels since December 10.On the downside, 0.8000 now becomes the key risk level. It is a natural psychological level and has acted as both support and resistance multiple times in the past, making it a critical short-term pivot.AUDUSDAUDUSD attempted to rally earlier in the session but stalled at resistance near 0.6727. That failure triggered a sharp move lower, breaking through both the 100-hour and 200-hour moving averages near 0.6700, and accelerating selling pressure down to a session low of 0.6674.The next key downside target sits at the 61.8% retracement of the December 18 rally at 0.66587, a level that also lines up with multiple prior swing highs and lows. A break below there would shift focus to the 0.6625–0.6635 support zone.For buyers to regain short-term control, price would need to move back above the 100- and 200-hour moving averages near 0.6700. This article was written by Greg Michalowski at investinglive.com.

Pres. Trump is speaking and with so many balls in the air, his comments are of market interest.Says we have a bad Fed Chair. Will pick a new Fed Chair in the next few weeks. On Iran:When asked about hell on the way to Iran, says you are going to have to figure it outHe says it is a good idea if Americans about away from Iran.Says Canada wants a USMCA Trump says we don't need it. (of course it was an agreement he made with Canada)Crude oil prices are higher. The current price is trading at $61.19. That is up about $1.70 or 2.82%Trump says he would like the price of oil at $53 a barrel. Last week Pres.Trump attempted to rally U.S. oil companies to invest heavily in Venezuelan oil extraction, offering assurances and pushing a big investment plan — but executives were cautious, especially ExxonMobil, and no major commitments were secured. Trump has since hinted at shifting support toward companies more willing to engage (like Chevron), and the broader strategy remains highly complex and contentious. Oil companies would need higher oil prices to justify the cost of extracting oil. In other news, The US treasury auctioned off $22 billion of 30 year bondsThe auction was met with strong demand:WI level at the time of the auction was 4.833%.High-yield came in at 4.825%Tail -0.8 basis points versus 6 month average of +0.5 basis pointsBid to cover 2.42x vs 6 month average 2.34XDirects 21.3% vs 6 month average of 23.9%Indirects 66.77% versus 6 month average of 63.7%Dealers 11.9% versus 6 month average of 12.4%.A look around other markets shows the major stock indices are lower. Yesterday the Dow and the S&P closed at record levels.Dow industrial average -0.78%S&P index -0.37% NASDAQ index -0.21%Yields are moving lower helped by the strong auction:2-year yield 3.524%, -2.3 basis points5 year yield 3.737%, -2.9 basis points10 year yield 4.167%, -2.0 basis points30 year yield 4.828%, -1.2 basis pointsGold is trading down $-5 or -0.11% at $4593. That comes after trading to a new record high of $4634.58 earlier today. Silver is still up $1.99 or 2.36% and $87.08. It traded to a new all-time high price earlier today at $89.11. This article was written by Greg Michalowski at investinglive.com.

St. Louis Fed President Alberto Musalem has laid out his baseline scenario for 2026: the U.S. economy could grow at or above-potential, the labor market should stabilise around current levels, and the central bank has likely reached the neutral level.Musalem’s comments suggests that he's satisfied with the current restrictive-to-neutral policy and doesn't see the need for faster easing without more labour market deterioration or bigger than expected moderation in inflation. He sees "robust" economy fueled by two major tailwinds: fiscal stimulus and lagged impact of rate cuts. While Musalem finds recent data "encouraging," he warns that inflation is still closer to 3% than the Fed’s 2% target. He expects goods and housing inflation to ease this year but warned that if service-inflation proved to be sticky, the Fed may have to hold rates higher for longer.He described the labor market as "cooling in an orderly way." He added that the US may need to add 30,000 to 80,000 jobs per month to keep the unemployment rate stable. He sees the current unemployment rate around its neutral level which shouldn't put upward pressure on inflation. He justified his support for the December rate cut as a preemptive strike to prevent the labor market from cooling too much.The most significant takeaway for markets is Musalem’s view that policy is "right around neutral" and that there is "little reason for further easing" in the near term. He's been holding this neutral/hawkish stance since last year.Musalem also added that he doesn't expect the Fed's reaction function to change much under the new chair, given the breadth of opinions among the 19 policymakers. In fact, even if we get a lackey as the next Fed chair, he won't be able to cut rates without good reasons as decisions are made on a majority basis. Moreover, following the recent events with the DOJ and all the constant attacks from Trump, there are good chances that Powell decides to remain on the Fed board until 2028. This article was written by Giuseppe Dellamotta at investinglive.com.

Trump said on Truth Social that all the meetings with Iran's officials have been cancelled and exhorted the Iranian people to keep protesting because help was on its way.For some context, the protests in Iran represent one of the most significant challenges to the Islamic Republic's authority in decades. The unrest was ignited by a catastrophic currency collapse, with the rial plummeting to over 1.4 million per USD, and a sharp hike in fuel prices. However, the protests quickly evolved into a broad rejection of the leadership.Just yesterday we got reports from Axios that Trump was floating the idea of outright strikes to weaken the Iranian regime, although it was also followed by less aggressive plans. Trump has also threatened to impose 25% tariff on any country doing business with Iran.It looks like the US President wants to fully take advantage of the protests to either overthrow the current regime or force them to sign deals on US terms.Trump's post triggered some risk aversion in the market with US stocks falling to session lows, crude oil extending gains and US dollar erasing earlier losses.On the daily chart above, we can see that the focus switched pretty quickly from Venezuela to Iran. Crude oil futures weakened following the capture of Maduro but then started to edge higher as the protests in Iran intensified and the US promised support to Iranian people.The price broke out of a major falling channel and rose above the key 60.50 swing level. There's no strong resistance until the 66.00 handle now. All eyes are on the US and Iran now as a military action would trigger a strong rally in oil prices and potentially a broad wave of risk aversion. This article was written by Giuseppe Dellamotta at investinglive.com.

August New Home sales 0.800MOctober New home sales 0.737M vs 0.7200 estimateSeptember new home sales was 0.738MThe months' supply is virtually unchanged from the September 2025 estimate of 7.9 months, and is 15.1 percent (±15.3 percent)* below the October 2024 estimate of 9.3 months.Median new-home price: $392,300, down 3.3% from September and 8.0% lower than October 2024, showing clear cooling in typical home prices.Average new-home price: $498,000, up 3.0% from September but still 4.6% below a year ago, reflecting a mix of higher-priced homes without reversing the broader downtrend.Price trend: Year-over-year declines in both median and average prices confirm housing disinflation is continuing.Macro impact: Cooling home prices reduce shelter inflation pressure, supporting lower long-term yields and giving the Fed more room to stay patient on rate cuts.The data is from October. The last I checked, it is January. The New-home sales data is still delayed because of the lingering effects of the 2025 U.S. government shutdown and the resulting backlog at the Census Bureau. This gap is a direct result of the shutdown halting data collection and reporting operations for several weeks. To fill that void, some third-party estimates (like the MBA Builder Application Survey) have been used, but the official Census Bureau figures remain unpublished for those months.President Trump recently announced a directive for Fannie Mae and Freddie Mac to purchase up to $200 billion in mortgage-backed securities (MBS) with the goal of pushing mortgage rates lower and improving housing affordability. Rather than the Federal Reserve buying bonds, this plan uses the large balance sheets and liquidity of the two government-sponsored enterprises to create demand for MBS, which tends to raise bond prices and reduce yields, and in theory can pull mortgage rates down modestly. The directive has already contributed to mortgage rates dipping below 6% — a level not seen in several years — providing some immediate relief to borrowers and potential refinance candidates. While this move can narrow spreads and support rate declines in the short term, its overall impact may be limited because $200 billion represents a small fraction of the much larger MBS market. The effect is likely to be more modest than the Federal Reserve’s massive bond-buying programs during the pandemic, which drove rates sharply lower. Moreover, long-term results depend on execution, timing of purchases, and broader economic conditions.Existing home sales data for December will be released tomorrow. The November report showed 4.13M up from 4.10M in the prior month. The estimate is 4.20M. Looking at the data since 2023, the data is fluctuating up and down with a high of 4.46M and a low of 3.85M. This article was written by Greg Michalowski at investinglive.com.