Not even a week into 2026, and things are already getting lively, especially in geopolitics. In the early hours of January 3, the United States launched a swift military operation in Venezuela aimed at capturing and extracting President Nicolás Maduro and his wife, both accused by Washington of narcoterrorism.But the motivations likely go beyond the immediate target. Based on statements from U.S. President Donald Trump and Secretary of State Marco Rubio, this could be just the first step in America’s broader effort to reassert influence in the Western Hemisphere.That said, markets don’t seem overly worried, with the Dow Jones hitting record highs on Monday and the S&P 500 also moving higher.Why such indifference?The operation hasn’t escalated into a full-scale war, the U.S. seems to have achieved its stated objectives, and investors see little reason to expect further conflict. Additionally, Venezuela’s massive oil reserves raise hopes that crude oil prices could fall, easing energy inflation and potentially allowing the Fed to cut rates more quickly.However, that last point is far from straightforward. Venezuelan oil is unlikely to reach global markets anytime soon, unless we’re talking about oil already loaded onto tankers.The problem is that Venezuela primarily produces heavy crude, which is more difficult and expensive to extract, requiring sophisticated infrastructure and logistics. After years of sanctions and underinvestment, the country’s oil industry is in poor condition. Restoring production to pre-sanctions levels would likely take years, by which time U.S. geopolitical priorities may have shifted again.The good news is that even if the U.S. doesn’t manage to bring Venezuelan oil to market quickly, some companies are poised to see faster profits, particularly those involved in rebuilding infrastructure, drilling, and refining.No wonder the biggest gains went to the stocks of oil service companies, especially Halliburton and SLB Limited, which handle the nuts and bolts of oil extraction. Chevron, the only major U.S. oil company still operating in Venezuela, saw its stock rise only about half as much, with ConocoPhillips and ExxonMobil trailing behind.The takeaway is that while markets are clearly optimistic, quick profits from the U.S. operation in Venezuela are far from guaranteed for all involved. Much will depend on how the situation unfolds — specifically, whether the new authorities in Caracas comply with U.S. demands or whether “Madurismo” and “Chavismo” persist under a new guise. This article was written by IL Contributors at investinglive.com.

There are some large expiries on the board for the day but they may not have all too much impact on price action. Let's take a look with the full list seen below.The first one is for EUR/USD at the 1.1725 level but the pair looks to be consolidating closer to 1.1700 after the overnight drop, which came after a bounce off the 100-day moving average on Monday. The key level is still seen at 1.1663 so that will provide a floor for price action ahead of the US jobs report while upside is more limited by the key hourly moving averages. The 100-hour moving average is at 1.1717 with the 200-hour moving average at 1.1747. So, that will help put a lid on things until we get key headlines to really break the shackles to start the year.Then, there is one for USD/CAD at the 1.3800 level. However, the expiries don't tie to any technical significance so I would not attach much substance to the potential impact in drawing price action. The pair is very much still continuing a bounce since late December with eyes on the 200-day moving average at 1.3848 currently.For more information on how to use this data, you may refer to this post here.Head on over to investingLive (formerly ForexLive) to get in on the know! This article was written by Justin Low at investinglive.com.

In case you missed the release and the earlier headlines:DATA: Australian CPI November 2024 3.4% y/yAustralian CPI slows to 3.4% in November, core inflation still firmly above targetJust a quick caveat to the latest inflation data here is that this is still a relatively new release. For some context, the October reading was the first complete monthly CPI published by the ABS. So, this is just the second one and is yet to iron out seasonal kinks. As such, the RBA again won't place too much emphasis on this and will wait on the full December quarter report - which will only be out on 28 January.In any case, let's take a look at the numbers and what do they mean for the RBA and the Australian dollar currency.Headline annual inflation showed some easing from 3.8% in October to 3.4% in November. However, that will do little to reassure the RBA of falling price pressures as the trimmed mean reading only showed a marginal drop from 3.3% in October to 3.2% in November. As a reminder, the trimmed mean reading is what the RBA focuses on as it is their handle of core inflation so to speak. On a monthly basis, the trimmed mean reading showed a 0.3% increase month-on-month.Of note, new dwelling prices (+2.8%) and rents (+4.0%) continue to hold higher with services inflation also remaining as a sticking point. Even food price inflation isn't showing much easing, seen at 3.3% and keeping thereabouts since June.So, what does this mean for the RBA?The data today doesn't shift the direction all too much. As things stand, the RBA is watchful and has to consider when they must take action if inflation actually proves too sticky and in need of policy intervention/action.That's basically the key trigger question right now, with the trimmed mean reading continuing to keep above the supposed target threshold band of 2% to 3%.As things stand, market players are pricing in ~35% odds of a rate hike at the next RBA policy meeting on 3 February. As for analyst calls, they are more divided. Looking at Australia's big four, CBA and NAB both have penciled in a rate hike for February while Westpac and ANZ forecast that the RBA will keep rates on hold for a longer period. However, Westpac does note that there are risks on both sides of the equation.So far, the RBA hasn't made it obvious as to when they might choose to act. However, they have made it clear that they are starting to come around to the view and narrative that Australia has a renewed inflation problem.At most, they might get away with leaving February on hold and then putting out a more convincing storyboard in hiking rates later this year. But as things stand, the risk seems to be that the central bank might have to sooner rather than later.What now for the Australian dollar?With ~35% odds priced in for a 3 February rate hike, the next key risk event to watch will be on 28 January when we get the December quarter data. That will be key in judging if inflation is really too sticky and the RBA might just have to do something about it. But with just ~42 bps of rate hikes priced in so far this year, there is scope to the upside in pricing in a more hawkish RBA if need be based on inflation developments.As for the short-term technical picture, AUD/USD remains largely bullish with the pair trading to its highest since October 2024. There was a bit of a setback on the data release earlier but the near-term outlook hasn't changed with price action keeping well above the key hourly moving averages. That hints at a more bullish near-term bias for now.There will be some resistance and offers layered closer to 0.6800, so that could offer some room for consolidation. But if the RBA continues to keep the door open for a February move and the broader risk mood holds up, the pair could stay underpinned in targeting the September 2024 highs around 0.6915-40.That being said, do keep in mind the dollar (and risk sentiment) side of the equation as well with the US labour market report due later this week. This article was written by Justin Low at investinglive.com.

RBI reported to be selling USD/INR 'heavily' to support/smooth the rupee (INR)Westpac: softer November CPI reassures RBA, lowers risk of further rate hikesGoldman Sachs sees China equities rising up to 20% by end-2026, earnings-ledBitcoin, solana ETFs planned as Wall Street leans into crypto, Morgan Stanley joins raceChina escalated tensions with Japan, bans exports of goods with potential military usesChina reviews Meta’s $2bn AI deal over export control concernsChina gives banks more leeway to sell bad personal loans, as defaults mountRussia deploys submarine to escort tanker amid U.S. pursuit off VenezuelaPBOC sets USD/ CNY mid-point today at 7.0187 (vs. estimate at 6.9896)Australian CPI slows to 3.4% in November, core inflation still firmly above targetJapan services PMI slows in December as cost pressures intensifyDATA: Australian CPI November 2024 3.4% y/yOIL - Trump says tens of millions of Venezuelan barrels to flow to U.S. marketsChina flags rate and RRR cuts in 2026 as PBoC leans dovishRubio reassures lawmakers on Greenland invasion fear: acquisition diplomatic, not militaryMSCI delays crypto treasury index shake-up , supportive for BTC and other cryptoMorgan Stanley forecasts gold at $4,800 by Q4 2026, sees continued Fed easingOil: Private survey of inventory shows a headline crude oil draw vs. build expectedMarkets across Asia were shaped by softer energy prices, a cooler-than-expected Australian inflation print and policy signals out of China, with FX moves largely contained despite some initial volatility.Oil prices continued to grind lower through the session. WTI crude fell more than USD 1/bbl after US President Donald Trump said interim authorities in Venezuela would hand over 30–50 million barrels of oil to the United States. Trump said the oil would be sold at market prices, with proceeds controlled by the US administration. The Wall Street Journal reported Trump is expected to meet with executives from Chevron, ConocoPhillips and Exxon Mobil later this week to discuss potential investment in Venezuela’s oil sector, reinforcing expectations of increased supply.In Australia, November CPI undershot expectations, though underlying inflation remains sticky. Headline inflation slowed to 3.4% y/y, below forecasts, while monthly CPI was flat. Core inflation eased only marginally, with the trimmed mean at 3.2% y/y, still above the Reserve Bank of Australia’s target band. Black Friday discounting drove price falls in furniture, footwear and clothing, raising questions over how durable the disinflation impulse will be. The data kept rate-hike risks on the radar ahead of the RBA’s 2–3 February meeting, though the balance of evidence still supports a hold (IMO anyway).Australian building approvals data were overshadowed by CPI but printed strongly, rising 15% m/m in November, driven by a 34% surge in volatile private unit approvals. Detached house approvals rose a modest 1%. While the trend remains upward, approvals remain well below the Housing Accord target, and higher-for-longer rate expectations may weigh on momentum ahead.The Australian dollar dipped initially on the CPI release but quickly recovered, rebounding to around 0.6760.In Asia FX, the Chinese yuan pulled back from a 32-month high after the PBoC set a weaker daily fix and reiterated its intention to maintain an appropriately loose policy stance, including scope for RRR and rate cuts. The Indian rupee strengthened after the RBI intervened to smooth volatility.Equities saw pockets of strength. Hyundai Motor shares surged 15% to a record after its CEO met Nvidia’s Jensen Huang at CES, fuelling speculation around an autonomous-driving partnership. Meanwhile, rare-earth related stocks rose across the region after China imposed export restrictions on military-use items to Japan, raising supply-chain concerns. Asia-Pac stocks:Japan (Nikkei 225) -1%Hong Kong (Hang Seng) -1% Shanghai Composite +0.3%Australia (S&P/ASX 200) +0.25% This article was written by Eamonn Sheridan at investinglive.com.

The Reserve Bank of India have stepped into the FX market with intervention so support the rupee. Yesterday I reported on four consecutive days of INR weakness, the RBI acting to avoid a fifth today. The rupee’s recent slide has been driven mainly by early-year importer hedging demand, compounded by a lack of strong foreign equity inflows. Market participants say these persistent structural flows have outweighed sporadic central-bank support, leaving the currency exposed to further downside pressure.Sentiment has also been dented by a deterioration in the US–India trade backdrop. Over the weekend, Donald Trump warned that Washington could consider higher tariffs on India if New Delhi does not rein in purchases of Russian oil. Those comments have added a geopolitical risk premium to the rupee at a time when positioning remains extended.The Reserve Bank of India has continued to play a stabilising role in recent sessions. After initially leaning against the currency’s move through the 90 level, the central bank appears to have reduced its presence as dollar demand persisted, reinforcing the view that officials are focused on managing volatility rather than defending a specific level.There may be some near-term relief from global factors. The US dollar has softened from a recent four-week peak as investors turn their attention to upcoming US data for clues on the Federal Reserve’s policy path. Markets are currently pricing in around two Fed rate cuts this year, a backdrop that could help cap further rupee weakness at the margin. I'm reluctant to see too mkuch releif for the ruppe though. Absent a reversal in portfolio flows, an improvement in global risk appetite, or a clear positive trade-related catalyst, the rupee is likely to remain under pressure. Without such shifts, a test of fresh record lows cannot be ruled out ahead despite today's intervention efforts. I suspect we'll see further bouts of RBI 'smoothing'. This article was written by Eamonn Sheridan at investinglive.com.

Summary:November CPI flat m/m, softer than Westpac expectedAnnual CPI eased to 3.4%, below forecastsDownside risk to December-quarter inflation outlookEnergy rebates again distorted electricity pricesWestpac sees RBA holding rates in FebruaryAustralia’s inflation pulse cooled more sharply than expected in November, a result that Westpac says should provide reassurance to the Reserve Bank of Australia that further policy tightening is not required in the near term.The latest Australian Bureau of Statistics data showed headline CPI was flat in the month, significantly weaker than Westpac’s near-term forecast for a 0.4% rise. On an annual basis, the new Complete Monthly CPI eased to 3.4% year-on-year in November, well below Westpac’s 3.8% estimate and softer than market expectations.Westpac said the weaker-than-expected outcome introduces downside risk to its current December-quarter inflation forecasts, which sit at 0.6% quarter-on-quarter for headline CPI and 0.8% for the trimmed mean. If confirmed following a full review of the monthly detail, the bank believes the data should be sufficient to comfort the RBA ahead of its February meeting, reducing the likelihood of a rate hike.The softer print was driven by a combination of weaker electricity prices and declines across several discretionary categories. Electricity prices rose far less than anticipated in the month, while household contents and services, clothing and footwear, and health all fell more sharply than Westpac had expected. Transport prices also rose more modestly. These declines were partly offset by firmer increases in food prices, rents, new dwellings and communications.Energy rebates continued to play a significant role in shaping the inflation profile. Electricity prices were up 19.7% over the year to November, but Westpac noted this reflected the dampening impact of state and federal rebate schemes. Excluding those rebates, the ABS estimates electricity prices rose 4.6% year-on-year, slightly slower than in October and consistent with annual price resets by energy retailers in mid-2025.Underlying inflation also edged lower. The trimmed mean rose 3.2% year-on-year in November, easing from 3.3% previously, while the monthly increase held steady at 0.3% — a pace Westpac notes has been consistent for several months.Looking ahead, Westpac expects the inflation pulse to continue moderating through 2026, outside of volatile items, administered prices and known supply shocks, reinforcing the case for the RBA to remain on hold in coming months. The Australian dollar has added to recent gains after the data, trading above 0.6760.---Reserve Bank of Australia meeting dates for the year ahead: This article was written by Eamonn Sheridan at investinglive.com.

Summary:Goldman targets MSCI China 100 and CSI 300 5,200 by end-2026 Upside case hinges on earnings acceleration aided by AI and policy Profit growth seen improving sharply versus 2025 pace 2026 starts strong after solid 2025 gains Key risks: demand, property, geopolitics/trade shocksGoldman Sachs is forecasting further gains for Chinese equities in 2026, arguing the next leg higher should be driven more by earnings delivery than pure sentiment as AI investment and policy support feed through into profits. Strategists expect the MSCI China Index to rise about 20% to 100 by end-2026, while the CSI 300 is seen climbing roughly 12% to 5,200, according to reporting on the call. The constructive view rests on a step-up in profit momentum. Goldman’s strategists see earnings growth accelerating to around 14% in 2026–2027, a notable improvement from an estimated ~4% in 2025, with the lift supported by a mix of AI-related productivity gains and policy measures aimed at improving the operating backdrop for corporates. Chinese equities have started 2026 on the front foot, adding to a strong 2025 performance that surprised many global allocators. The CSI 300 and MSCI China were already higher early in the year after logging double-digit advances in 2025, reinforcing the idea that a “slow bull” dynamic may be taking hold if earnings expectations keep firming. Goldman’s broader framing is that valuations still leave room for upside if profits deliver and policy credibility holds, but the bank’s central message is that sustained returns will likely require real profit growth, not just multiple expansion. In that sense, AI adoption becomes a key swing factor: if it lifts margins and supports top-line growth across major index sectors, the earnings cycle could look meaningfully better than recent years.Goldman Sachs note that risks remain. A weaker-than-expected domestic demand recovery, renewed property-sector stress, or a flare-up in geopolitical or trade tensions could undermine confidence and cap the valuation re-rating. Still, Goldman’s targets suggest the bank believes the base case is improving: a more earnings-driven market, supported by technology diffusion and a still-helpful policy mix, can keep China equities climbing into 2026. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Morgan Stanley files for bitcoin and solana ETFsApplications submitted to the U.S. SECBitcoin ETFs now manage over $120bn in assetsNon-bitcoin crypto ETFs have seen weaker inflowsMove highlights growing institutional adoptionEarlier:MSCI delays crypto treasury index shake-up , supportive for BTC and other cryptoBitcoin rises as PwC leans into crypto on US regulatory shiftMorgan Stanley is preparing to deepen its push into digital assets, filing applications to launch exchange-traded funds that would hold Bitcoin and Solana, underscoring the continued integration of cryptocurrencies into mainstream finance.Info, ICYMI, via the Wall Street Journal (gated). Regulatory filings submitted to the U.S. Securities and Exchange Commission show the investment bank plans to offer separate ETFs providing direct exposure to the two digital tokens. If approved, the products would place Morgan Stanley alongside a growing list of major financial institutions seeking to capitalise on investor demand for regulated crypto investment vehicles.The move follows the rapid expansion of U.S.-listed bitcoin ETFs since their launch in 2024. A group of 11 spot bitcoin ETFs, including products from BlackRock and Fidelity Investments, has attracted substantial inflows, with combined assets under management now exceeding $120 billion, according to data cited by JPMorgan. The success of these funds has helped cement bitcoin’s status as the dominant institutional entry point into the crypto market.Momentum outside bitcoin has been more uneven. Asset managers have also rolled out ETFs and exchange-traded products tracking other cryptocurrencies such as ether and solana, but these offerings have generally seen more modest inflows. That divergence reflects investors’ continued preference for bitcoin as a perceived store of value, compared with alternative tokens that are often viewed as higher risk and more sensitive to shifts in market sentiment.Market pricing reflects that volatility. Bitcoin was trading near $92,000 on Tuesday after rebounding from recent lows, but remains roughly 27% below its early-October peak above $126,000. Solana hovered around $137, well off its record high of about $294, highlighting the sharper drawdowns seen across the broader crypto complex.A Morgan Stanley spokesperson declined to comment beyond the details disclosed in the filings. Still, the applications signal growing confidence among large financial institutions that regulatory pathways for crypto ETFs are becoming clearer, even as price volatility and uneven investor appetite persist. This article was written by Eamonn Sheridan at investinglive.com.

Summary:China bans exports of dual-use goods to Japan Move follows Taiwan-related remarks by Japan’s prime ministerRestrictions take effect immediatelyRare earths, electronics and machine tools among potential targetsHighlights China’s use of trade as geopolitical leverage Japan’s Chief Cabinet Secretary Minoru Kihara said China’s export curbs aimed solely at Japan were regrettable, adding that Tokyo will examine the details and consider an appropriate response.China has sharply escalated its dispute with Japan by banning exports of goods with potential military applications, a move that takes effect immediately and signals Beijing’s willingness to deploy economic pressure in response to political disagreements over Taiwan.In a statement on Tuesday, China’s Ministry of Commerce of China said it would prohibit exports to Japan of so-called dual-use items — products that can be used for both civilian and military purposes. The decision marks a clear intensification of retaliation against comments made by Japanese Prime Minister Sanae Takaichi, who has spoken publicly about Taiwan, a topic Beijing treats as a core sovereignty issue.While Chinese authorities did not specify which goods are covered by the ban, analysts warn the move could disrupt key supply chains underpinning Japan’s manufacturing sector. Dual-use categories typically include certain rare earth elements, advanced machine tools, electronic components, sensors, lasers and other inputs widely used in industrial production. The lack of detail makes it difficult to quantify the immediate economic impact, but the breadth of the category raises the risk of meaningful supply bottlenecks.The action underscores how China is increasingly willing to use trade and export controls as a geopolitical lever. Beijing considers Taiwan a breakaway province and has repeatedly warned foreign governments against actions or statements it views as supporting Taiwanese independence. The latest step also serves as a broader signal to other countries of the economic costs that can follow criticism of China’s stance on Taiwan.China’s leader Xi Jinping has previously demonstrated this playbook. During last year’s trade confrontation with the United States, Beijing tightened controls on exports of critical minerals and magnets used in everything from semiconductors to defence systems, highlighting its dominance in key supply chains.For Japan, the ban adds a new layer of geopolitical risk at a time when firms are already grappling with fragile global supply networks. Analysts warn that prolonged restrictions could weigh on industrial output, investment decisions and corporate margins if alternative sources prove costly or slow to secure.Overall, the move deepens tensions between Asia’s two largest economies and reinforces concerns among global investors that trade policy, national security and geopolitics are becoming increasingly intertwined — particularly where China’s strategic interests are involved. This article was written by Eamonn Sheridan at investinglive.com.

Summary:China reviewing Meta’s $2bn acquisition of AI firm ManusFocus on whether technology transfer required export licenceReview is preliminary, not yet a formal investigationManus gained attention for autonomous AI agent technologyCase highlights rising geopolitical risk around AI dealsChinese authorities are reviewing Meta’s roughly $2 billion acquisition of AI start-up Manus for potential violations of China’s technology export control rules, raising fresh uncertainty around one of the year’s most high-profile artificial intelligence deals.According to people familiar with the matter, officials at China’s Ministry of Commerce of China have begun assessing whether the relocation of Manus’s staff and core technology to Singapore, ahead of its sale to Meta, should have required an export licence under Chinese law. While the review is still at an early stage and may not evolve into a formal investigation, the licence question alone could give Beijing leverage over the transaction.Manus, which is now based in Singapore, attracted widespread attention earlier this year after releasing what it described as the world’s first general AI agent, software capable of autonomously making decisions and executing tasks with minimal prompting, setting it apart from traditional chatbots. The product’s viral reception underscored growing interest in agent-based AI systems and their potential commercial and strategic value.Meta completed the acquisition last month, with sources indicating the deal valued Manus at between $2 billion and $3 billion. Neither Meta nor Manus has commented publicly on the regulatory review, and Reuters said it could not independently verify the Financial Times (gated) report.For Beijing, the case highlights increasing sensitivity around advanced AI capabilities and the movement of high-value technology overseas. China has steadily tightened its export control framework in recent years, particularly for technologies deemed strategically important, including advanced semiconductors, AI models and data-intensive systems.While officials have not accused the companies of wrongdoing, analysts note that an export-licence requirement could, in an extreme scenario, allow regulators to delay, condition or even pressure parties to unwind the transaction. More broadly, the review underscores the growing regulatory and geopolitical risks facing cross-border AI deals, especially those involving Chinese-origin technology and major U.S. tech firms. This article was written by Eamonn Sheridan at investinglive.com.

Summary:China extends policy allowing disposal of bad personal loansAim is to support banks amid rising defaults and weak marginsTransfers of bad personal loans surged sharply last yearCredit card loan stress remains a key concernRegulators prioritising balance-sheet stabilityChina’s financial regulators have moved to extend a key policy allowing banks and asset management firms to dispose of non-performing personal loans, signalling a renewed push to stabilise balance sheets as credit stress builds and profitability comes under pressure.According to sources familiar with the matter, report Bloomberg (gated), the National Financial Regulatory Administration (NFRA) issued guidance last week extending rules that permit the transfer and sale of soured personal loans and non-performing single-borrower corporate loans beyond their original end-2025 deadline. The policy, first introduced in early 2021, had been due to expire next year.The extension highlights regulators’ growing concern over deteriorating asset quality, particularly in consumer finance. Rising defaults on credit cards and other personal loans have become a notable strain for banks, even as broader economic conditions remain uneven and household confidence fragile. By allowing greater flexibility in offloading bad assets, authorities are seeking to prevent further pressure on capital ratios and preserve financial stability.Chinese lenders have already stepped up efforts to clean up their balance sheets. Transfers and write-offs of distressed assets have accelerated sharply as net interest margins have fallen to record lows, squeezing profitability and reducing banks’ capacity to absorb losses organically. Official data cited by local media show transfers of bad personal loans reached 37 billion yuan in the first quarter of last year, more than eight times higher than the same period a year earlier.Within that total, transfers of non-performing credit card loans rose to 5.19 billion yuan, underlining stress in unsecured consumer lending. The surge in activity points to a more proactive approach by banks to managing problem assets, though transparency has become more limited after the official credit asset transfer centre suspended regular disclosure of detailed figures.For policymakers, the extension of the disposal framework reflects a balancing act. Regulators want banks to recognise and resolve bad loans more quickly, but without triggering a sharp tightening in credit conditions or undermining confidence in the financial system. Allowing continued asset transfers to specialised management firms provides a pressure valve at a time when economic recovery remains patchy.Overall, the move reinforces Beijing’s message that financial stability remains a priority, even as rising defaults and weak margins underscore the challenges facing China’s banking sector in the current cycle. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Russia sent a submarine to escort a tanker the U.S. is trying to seize. Bella 1 reflagged itself with a Russian flag and renamed to Marinera amid pursuit. Moscow has formally protested U.S. pursuit and called for it to stop. U.S. blockade is part of sanctions enforcement on Venezuelan and other sanctioned oil flows. The move raises risks of naval confrontation and complicates sanctions regimes.Russia has deployed a submarine and other naval assets to escort an oil tanker that the United States has been trying to seize in a maritime flashpoint tied to sanctions enforcement and geopolitical tensions, according to a report in the Wall Street Journal (gated). The vessel, formerly known as the Bella 1, has been at the centre of a prolonged cat-and-mouse pursuit by the U.S. Coast Guard and has now drawn Moscow directly into the dispute.The Bella 1, a rusting, sanctioned tanker linked by U.S. authorities to illicit oil transport, failed to load cargo in Venezuela and has been attempting to avoid a U.S. blockade imposed as part of sanctions targeting the Maduro regime’s oil exports. U.S. forces chased the vessel into the Atlantic after its crew repelled a U.S. boarding attempt in December and refused to comply with orders in Caribbean waters. In a dramatic gambit to deter further U.S. interception, crew members painted a Russian flag on the hull, renamed the ship Marinera and registered it under Russian registry without standard verification, a move legal experts say does not automatically confer genuine nationality but complicates enforcement. Moscow’s decision to provide a submarine escort marks a significant escalation in maritime tensions with Washington and underscores Russia’s concern about U.S. actions aimed at cutting off revenue from oil tied to Venezuela and, in some instances, Iran. Russian officials have formally protested U.S. pursuit and called on Washington to cease chasing the vessel, a diplomatic note that reflects broader friction over enforcement of sanctions regimes and interpretations of international maritime law.The stand-off comes amid a heightened U.S. naval and aerial presence in the Caribbean, driven by a broader campaign to intercept sanctioned tankers under “Operation Southern Spear” and choke the flow of crude exports that may be funding hostile actors or bolstering adversary states. Analysts warn that Russia’s willingness to protect reflagged tankers with military assets could further complicate U.S. enforcement efforts, raise the risk of direct military confrontations at sea, and deepen geopolitical rivalry over access to energy resources. The incident also highlights emerging strategies by sanctioned ship operators, such as reflagging vessels to shield them from interdiction, that are testing the limits of sanctions enforcement and maritime legal frameworks. Meanwhile:OIL - Trump says tens of millions of Venezuelan barrels to flow to U.S. markets This article was written by Eamonn Sheridan at investinglive.com.

The People's Bank of China (PBOC), China's central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). 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 6.9830PBOC injects 28.6bn yuan in open market operation reverse repos at an unchanged rate of 1.4%:after maturities today the PBoC has net drained 500.2 bn yuanIn other news from China earlier:China flags rate and RRR cuts in 2026 as PBoC leans dovishPBoC signals rate cuts and RRR reductions in 2026Monetary policy to remain “appropriately loose”Focus on boosting demand and stabilising growthDecember LPR left unchanged for seventh straight monthYuan stability remains a key policy constraintChina’s central bank said it will cut reserve requirements and interest rates in 2026 to keep liquidity ample, reaffirming an appropriately loose policy stance aimed at supporting growth, managing risks and keeping the yuan broadly stable.And:China is considering stricter reviews of rare-earth export licences to Japan, with the Commerce Ministry also saying it will prohibit all dual-use exports destined for Japanese military end-users. ---Not related, but the focus for the session here earleir:Australian CPI slows to 3.4% in November, core inflation still firmly above targetData supports RBA hold, not an imminent pivot to rate hikes (IMHO anyway)Australia’s inflation pulse softened in November, with headline price pressures easing more than expected, though underlying inflation remains uncomfortably firm for policymakers.Data from the Australian Bureau of Statistics showed the Consumer Price Index rose 3.4% year-on-year in November, down from 3.8% in October and below market expectations of 3.7%. On a monthly basis, headline CPI was flat (0.0%).Underlying measures also edged lower but remained elevated. The trimmed mean CPI, the Reserve Bank of Australia’s preferred gauge of core inflation, slowed to 3.2% y/y from 3.3%, broadly in line with expectations. On a monthly basis, trimmed mean inflation rose 0.3%, unchanged from October. The weighted median CPI also increased 0.3% m/m and stood at 3.4% y/y. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Headline CPI slowed to 3.4% y/y, below expectations (more data here)Monthly inflation flat at 0.0%Trimmed mean eased to 3.2% y/y, still above targetHousing, food and transport remain key inflation driversData supports RBA hold, not an imminent pivot to rate hikes (IMHO anyway)Australia’s inflation pulse softened in November, with headline price pressures easing more than expected, though underlying inflation remains uncomfortably firm for policymakers.Data from the Australian Bureau of Statistics showed the Consumer Price Index rose 3.4% year-on-year in November, down from 3.8% in October and below market expectations of 3.7%. On a monthly basis, headline CPI was flat (0.0%).Underlying measures also edged lower but remained elevated. The trimmed mean CPI, the Reserve Bank of Australia’s preferred gauge of core inflation, slowed to 3.2% y/y from 3.3%, broadly in line with expectations. On a monthly basis, trimmed mean inflation rose 0.3%, unchanged from October. The weighted median CPI also increased 0.3% m/m and stood at 3.4% y/y.Housing remained the largest driver of annual inflation, rising 5.2% over the past year, followed by food and non-alcoholic beverages (+3.3%) and transport (+2.7%). These components continue to reflect elevated rents, insurance costs and services-related price pressures, even as goods inflation cools.While November’s outcome marks a welcome step lower for headline inflation, the broader signal for policymakers is more nuanced. With two months of data now available, the trimmed mean for the December quarter still appears too firm to give the RBA immediate comfort that inflation is returning sustainably to the 2–3% target band. Services inflation and labour-linked costs remain sticky, limiting the scope for near-term policy easing.Market reaction was measured. The Australian dollar initially dipped on the softer-than-expected headline print but quickly recovered to trade little changed, reflecting the balance between improving headline momentum and persistent core inflation.Overall, November’s CPI supports the case for the RBA to hold rates steady for now, while reinforcing that policymakers will want clearer evidence of sustained easing in underlying inflation before shifting to an outright dovish stance. Separately we had building permits data for November, 15.2% m/mexpected 2.0%, prior -6.4% This article was written by Eamonn Sheridan at investinglive.com.

Summary: Japan services PMI slowed to 51.6, weakest since MayNew order growth softened despite renewed export demandEmployment rose at fastest pace since mid-2023Input costs and selling prices accelerated sharplyBusiness confidence remains historically strongJapan’s service sector continued to expand in December, but at its slowest pace in seven months, signalling a loss of momentum as 2025 drew to a close, according to the latest survey data from S&P Global.The Services PMI Business Activity Index slipped to 51.6 in December from 53.2 in November, marking the softest pace of expansion since May. While activity remained in growth territory for a ninth consecutive month, the moderation points to cooling demand conditions across large parts of the sector. Finance and insurance firms remained the standout performers, recording the strongest rise in activity among the major service industries surveyed.New business volumes also increased at a slower and only modest rate, reflecting mixed demand conditions. Some firms cited improved customer flows and new project wins, while others reported subdued client activity. Notably, total new order growth slowed despite a return to growth in export services demand, the first such increase since June, highlighting tentative improvement in foreign demand.Employment trends remained a clear bright spot. Service-sector hiring accelerated sharply, with staff numbers rising at the fastest pace since May 2023. Firms pointed to higher sales volumes and efforts to fill long-standing vacancies, while a renewed rise in outstanding business suggested growing capacity pressures that supported additional hiring.Cost dynamics, however, remained challenging. Input cost inflation accelerated to its highest level since May, driven by rising prices for labour, raw materials, fuel, equipment and construction inputs. These pressures were passed through to customers, with output charges rising at a historically strong pace, reinforcing concerns that services-led inflation remains sticky.The broader private-sector picture also softened. The Composite PMI Output Index eased to 51.1 from 52.0, the slowest expansion since May, as services growth moderated while manufacturing output broadly stabilised after a prolonged downturn. Composite new orders rose only slightly, though foreign demand for goods and services declined at the slowest pace in nine months.Despite softer momentum, business confidence remained elevated. Firms expressed optimism that new product launches, store openings and improving demand conditions would support activity through 2026, even as they balance rising costs against increasingly price-sensitive customers. This article was written by Eamonn Sheridan at investinglive.com.

Australian CPI November 2024Headline y/y 3.4%expected 3.7%, prior 3.8%Headline m/m 0.0% prior 0%Trimmed Mean y/y 3.2%expected 3.2%, prior 3.3%Trimmed Mean m/m 0.3%prior 0.3% Posting the data here for quick access, detail on a separate post soon.Summary: 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. Earlier:China flags rate and RRR cuts in 2026 as PBoC leans dovishChina 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: Trump says Venezuela will send 30–50m barrels of oil to the U.S.Proceeds from sales to be controlled by the U.S. administrationMove follows U.S. capture of Maduro and international backlashTalks underway to redirect Venezuelan crude exports into U.S. marketsOil companies may be tapped to rebuild Venezuela’s energy sectorPresident Donald Trump announced via social media that interim authorities in Venezuela have agreed to transfer between 30 million and 50 million barrels of sanctioned crude oil to the United States, in a move that underscores Washington’s broader efforts to secure energy resources amid geopolitical upheaval. In a string of posts on Jan. 6, Trump said the oil will be sold at market prices and proceeds will be under his control, with Energy Secretary Chris Wright tasked with executing the plan.This development follows the dramatic U.S. capture of Venezuelan President Nicolás Maduro in a military operation that has drawn global criticism and heightened tensions in Latin America. While U.S. officials characterize the action as a law-enforcement mission, many governments and international bodies have condemned it as a violation of sovereignty and international law. The proposed transfer of Venezuelan oil to the U.S. comes amid ongoing talks, separate from the social-media announcement, between Washington and Caracas to redirect crude exports originally bound for other markets into the United States, potentially easing supply strains and offering relief for U.S. energy security. Analysts say such a shift could help offset production shortfalls elsewhere, although the legality and long-term viability of these arrangements are highly contested. Oil markets have responded unevenly this week, with some price volatility reflecting uncertainty about the pace and scale of Venezuelan crude flows. U.S. oil companies are reportedly preparing to discuss potential roles in reviving Venezuela’s dilapidated oil infrastructure, a task likely to require billions in investment and face political as well as operational obstacles.Critics argue that directing sanctioned Venezuelan oil into U.S. markets and centralizing control of revenues in the executive branch raises legal and ethical concerns. The shipments Trump refers to looks to be in relation to the barrels built up during the blockade, both one ships and in overflowing domestic storage. This article was written by Eamonn Sheridan at investinglive.com.

Two things are hitting at once and they're surely related. The first is from an unnamed US official quoted by Reuters but it came simultaneously with a White House statement saying:Trump has made clear that acquiring Greenland is a 'national security priority'Trump would like to acquire Greenland during his termTrump and advisors discussing options including purchasing it from Denmark or forming a compact of free associationUtilizing the military is always an optionThat last one is the real kicker. What a bizarre saga this is, straight mafia stuff. Anything untoward or violent would certainly force the EU to go from 'strong levels of concern' to actual repercussions, if only on trade. This article was written by Adam Button at investinglive.com.

Some time in the not-too-distant future, markets are going to be hit with headlines about the US Supreme Court on tariffs.Technically, they have until late-June to rule but because this was an expedited hearing, that's likely to come much sooner. It was looking like the earliest option would be the week of January 19 based on the Court's schedule but today that scheduled changed. Friday has been announced as a 'decision day'. This is how the court usually operates. There is a 1-3 day 'heads up' that a decision is coming but no indication of which cases will be decided. It could be tariffs or a myriad of other cases before the court. We will have to be ready for until it's announced, which is usually at 10 am ET.Arguments in early November suggested the court was skeptical that Trump had authority to impose the tariffs under a 1977 law. Kalshi pegs the odds at 70/30 that tariffs are struck down so that's a good guide on what's priced in but the stakes are high.Some trades to consider on both sides of the decision:1) Import-heavy retailers (gross margin relief + fewer price hikes)XRT, COST, WMT, TGT, AMZN, BBY2) Apparel & footwear (sourcing-heavy, high sensitivity to landed costs)NKE, GAP, RL3) Consumer discretionary factor (tax-cut-like effect for goods)XL, FIV, ELF 4) Housing / “stuff in the house” supply chain (materials + fixtures + appliances)ITB, LEN, W, RH5) Downstream manufacturers (big metal users; tariffs are a cost)CAT, DE, PCAR, ETN6) Autos & cross-border supply chains (North America / global OEMs)GM, F, TM7) USMCA currenciesYou can buy MXN or CAD or the country ETFs EWW (Mexico), EWC (Canada)If tariffs are upheld, you could see a benefit in the steel names but those are protected under separate Section 232 tariffs that aren't at risk from the Supreme Court, so I would buy a dip in steel names at some point (maybe not right after the decision). It's similar for aluminum.I also believe that one of the cleanest trades on the tariff ruling is gold as it should weaken if tariffs are blocked and pop if they're upheld.Some names that could do well if tariffs are upheld1. Reshoring / factory build-out / industrial capex (picks-and-shovels)XLI, FLR, PWR, J, ROK, PH2. Inflation/uncertainty hedges (if tariffs = higher prices + noisier growth)XLE (energy as hedge)GDX (gold miners as uncertainty/stagflation hedge)3. Bonds as uncertainty risesIf the Supreme Court supports fentanyl tariffs as a national emergency, what else might they support?I would also keep a very close eye on the above names in the lead-up to Friday because everything leaks lately and it's open season on insider trading.There is plenty of nuance at stake about whether the Supreme Court leaves other paths open and whether tariffs are refunded (unlikely) but it's something to think about for the next two days. This article was written by Adam Button at investinglive.com.