Zerohedge

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The Trump administration on Feb. 9 urged a federal judge to rescind an order that blocks Department of Government Efficiency (DOGE) personnel and some other government workers from accessing U.S. Department of Treasury records.

The order from U.S. District Judge Paul A. Engelmayer bars access to the payment records for all personnel apart from civil servants “with a need for access to perform their job duties.”

“On its face, the Order could be read to cover all political leadership within Treasury—including even Secretary Bessent,” government lawyers said in an emergency motion to the court, referring to Treasury Secretary Scott Bessent. 

“This is a remarkable intrusion on the Executive Branch that is in direct conflict with Article II of the Constitution, and the unitary structure it provides.”

Article II grants the president the power to appoint the heads of executive agencies and to seek their opinions on any subject relating to their duties.

“Basic democratic accountability requires that every executive agency’s work be supervised by politically accountable leadership, who ultimately answer to the President,” the government lawyers said on Sunday. 

“A federal court, consistent with the separation of powers, cannot insulate any portion of that work from the specter of political accountability. No court can issue an injunction that directly severs the clear line of supervision Article II requires. Because the Order on its face draws an impermissible and anti-constitutional distinction, it should be dissolved immediately.”

If the order is not dissolved, the court should clarify or modify the order to make clear it does not cover top Treasury officials, according to the motion, and if the court is unwilling to grant relief, it should stay the order pending the outcome of an appeal.

U.S. District Judge Jeannette A. Vargas, who is overseeing the case, after receiving the motion ordered the parties to meet and confer regarding the motion “to determine if the parties can reach agreement on a stipulation that either resolves or narrows the issues presented in the Motion.”

If the parties cannot reach an agreement, the plaintiffs are ordered to file a reply by 5 p.m. ET on Monday, with a response to the reply due from government lawyers six hours later.

The case was brought by New York and 18 other states against President Donald Trump and Bessent. The states said that the government giving access to payment records to DOGE, which is headed by Elon Musk, posed cybersecurity risks and imperiled the privacy of state residents whose financial information and other personal data were stored in the files.

The states asked for an order blocking the access and received the order early Saturday.

By Benjamin Picton of Rabobank

As I write this Daily it is Monday morning here in Sydney, but Superbowl Sunday in the USA. The Kansas City Chiefs are taking on the Philadelphia Eagles, but the real winner on the day may be the steelers. Not the Pittsburgh NFL franchise, but the steel workers of the United States who Donald Trump has just pledged to protect via a fresh round of import tariffs.

Speaking aboard Air Force One on his way to the big game, Trump said that he will be announcing 25% tariffs on steel and aluminium imports on Monday. Of course, we’ve heard this tune before and some previous tariff announcements (the ones on Mexico and Canada, for instance) have yet to be enacted, but the markets aren’t judging Trump’s comments as an incidence of him crying “wolf!” this time around. Nevertheless, Sectoralists will be shouting “see!”, while economic Rationalists murmur reassurances to themselves of an imminent back-down, and hope that input prices aren’t about to rise (again).

USDCAD has leapt 68pips since the open to be up 0.47% (Canada being a major exporter of aluminium to the USA), the AUD is down 0.41% (Australia’s third-largest company being a major exporter of Canadian aluminium to the USA) and EURUSD is down 0.32% in early trade. Liquidity is thin this time of a Monday morning, but even so the EUR usually doesn’t move much in this timezone. So, this kind of price action is certainly eye catching.

Aussie and Kiwi bonds are both seeing yields jump, despite drifting lower over the course of last week as the antipodeans approach central bank meetings where both are expected to cut policy rates. Crude oil prices rose on Friday but still finished in the red for the week. Brent is dealing at $74.76/bbl while WTI is seeing a little more upward momentum this morning to change hands at $71.12/bbl. Spot gold is again threatening new highs at $2,870.

The release of the January US non-farm payroll report on Friday confirmed employment growth of just +143,000 in the month. That was a little more than one standard deviation below the median estimate on the Bloomberg survey of +175,000, and below the average pace of job creation in 2024. The soft employment growth figure seemingly confirms the signal from JOLTS and jobless claims earlier in the week that gave the impression of a cooling labor market.

However, the payrolls report wasn’t all bad news. The unemployment rate (measured by the Household Survey) unexpectedly fell from 4.1% to 4% even as participation lifted by one-tick and average hourly earnings exceeded the 3.8% estimate to leap by 4.1% year-on-year. Stronger earnings growth might have been flattered somewhat by a decline in average hours worked, which in turn may been muddied somewhat by the influence of the California wildfires. The two-month net payroll revision saw estimates of prior job creation bumped up by an extra 100,000 positions.

Nevertheless, USDJPY reacted negatively to the release and experiencing sustained selling that got a second wind when the University of Michigan consumer sentiment report dropped a few hours later. That report showed declining optimism on the ‘current conditions’ and ‘future expectations’ indices, while 1-year ahead inflation expectations leapt from 3.3% previously to 4.3%! With gold prices pumping higher and tariffs incoming, perhaps we’re about to start hearing more about ‘stagflation’ in the months ahead?

Of course, there’s always the chance that stagflation will be staved off by promised tax cuts and that we just end up with the “’flation” part and higher-for-longer policy rates. Trump has dangled the idea that tariffs (the most beautiful word in the dictionary) might pay for cuts to income taxes, but that only works if the tariffs are actually imposed. Merely threatening tariffs and watching on in amusement as international counterparts jump to comply won’t do the trick.

Unfortunately, tariffs might not do the trick either. The USA (and pretty much everyone else) used tariffs to fund the functions of government prior to WWI, but government accounted for a far smaller share of GDP and the welfare state was virtually non-existent at the time. Today, entitlements (that Trump has promised not to cut) make up almost two-thirds of all federal spending while defense (which Trump wants to spend more on) makes up 15% and debt servicing costs make up 13%. Even with Elon Musk and his team at the DOGE furiously cutting away, the math ain’t mathin’.

One possible outcome is for a kind of ‘worst of all worlds’ financial repression scenario where income taxes don’t get cut and US consumers contribute more via tariffs and the stealth tax of inflation. Defense costs could be ameliorated by forcing allies (like NATO) to either buy more US hardware or buy WAY more US Treasuries (or both) to keep the funding costs low. Wall Street banks have been hopeful that the Trump Administration might provide some relief from capital requirements, perhaps that arrives via more generous capital treatment of Treasury bond holdings to encourage more buying? Perhaps FIs might be told to hold more Treasuries for reasons of liquidity?

Secretary of State Marco Rubio and Defense Secretary Pete Hegseth have obviously paid some thought to these problems of how to fund the US military without raising taxes or cutting social spending. Rubio recently pointed to the AUKUS agreement struck between the USA, UK and Australia as “almost a blueprint” for how the Trump White House would like to engage with allies. While meeting with Aussie Defence Minister Marles over the weekend, Hegseth confirmed that Trump is “very aware” and “supportive” of the terms of AUKUS.

That meeting was Hegseth’s first with a foreign counterpart and was timed to coincide with Australia making a $500m tribute payment under the agreement to help bolster US shipbuilding. The quid pro quo here is that the USA has agreed to provide Australia with second-hand nuclear-propelled submarines in the early 2030s, rotate US submarines through Aussie bases from 2027 and help Australia develop its own naval shipbuilding industry by sharing expertise on everything up to closely-guarded nuclear secrets (previously only shared with the UK).

Once again we emphasize that the market tail is being wagged by the geopolitical dog and that being the ‘tail’ involves tail risks. As Trump again today confirms that he is serious about the USA taking over Gaza and developing it into the “Riviera” of the Middle East, it is worth pointing out that having a land presence adjoining the Suez Canal is EXACTLY the sort of thing that Great Powers (Britain and France) used to be keen to do in previous periods of geopolitical competition.

This kind of thinking (the same thinking applied on Panama and Greenland) looked out of date the decades following the end of the first Cold War, but traders are now going to have to expand their reference period if they want to understand where the market could be heading in the years ahead.

So, US steelers may be getting the win tomorrow, but the free traders and long-term free-riders under the US defence umbrella look set to be losers.

President Donald Trump directed Treasury Secretary Scott Bessent on Sunday night to halt the minting of new pennies, citing “wasteful” spending as coin production costs soar. 

“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful! I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time,” Trump wrote on Truth Social. 

Trump is entirely correct about the rising costs associated with coin production. Last year, the US Mint’s annual report revealed that it costs 3.69 cents to produce and distribute a penny, resulting in a loss of 2.69 cents per coin for the federal government. 

As of last year, about 250 billion pennies were in circulation in the US, equivalent to about 700 per person. 

The US Mint’s total loss on the year for pennies was about $85.3 million. 

Don’t tell Trump and the DOGE team, but the nickel costs about double its face value to produce and distribute. 

In 2011, Kyle Bass recognized that the metal in a nickel coin was worth well above its face value. He stated then, “I just bought a million dollars’ worth of them.”

Regarding the legal authority surrounding currencies, Article I, Section 8 of the Constitution indicates: “The Congress shall have power … to coin money [and] regulate the value thereof.”

However, Robert K. Triest, an economics professor at Northeastern University, told NBC News that the president may have some wiggle room.

“The process of discontinuing the penny in the US is a little unclear. It would likely require an act of Congress, but the Secretary of the Treasury might be able to simply stop the minting of new pennies,” Triest explained. 

Cost-cutting measures by Trump and DOGE are part of a mandate a majority of Americans gave the president for his second term in office, already winding down a few rogue federal agencies and eliminating thousands of bureaucrats from office. 

Back to coins: Australia withdrew its one- and two-cent coins from circulation in 1992, while Canada ceased penny production in 2012.

Elon Musk’s team of mid-20s Department of Government Efficiency (DOGE) disruptors has once again found wasteful spending—this time focusing on a $59 million payment sent by the Federal Emergency Management Agency to luxury hotels across New York City housing illegal aliens.  

“The DOGE team just discovered that FEMA sent $59M LAST WEEK to luxury hotels in New York City to house illegal migrants,” Musk wrote on X early Monday morning. 

Musk explained, “Sending this money violated the law and is in gross insubordination to the President’s executive order,” adding, “That money is meant for American disaster relief and instead is being spent on high end hotels for illegals!” 

Musk did not specify which luxury NYC hotels received FEMA funding for migrants last week but noted that a “clawback demand will be made today to recoup those funds.” 

The @DOGE team just discovered that FEMA sent $59M LAST WEEK to luxury hotels in New York City to house illegal migrants.

Sending this money violated the law and is in gross insubordination to the President’s executive order.

That money is meant for American disaster relief…

— Elon Musk (@elonmusk) February 10, 2025

However, a December report revealed that NYC politicians spent $220 million in a sweetheart deal with Pakistan to lease the prestigious Roosevelt Hotel in Midtown Manhattan for illegal alien housing. The most alarming issue was that NYC paid a foreign government to house illegals. 

“So let me get this straight; places like North Carolina and Maui get a pittance because FEMA says they lack funds, so we have to send our Military there to do work that could be put into the local economies.  Meanwhile FEMA blows its budget on housing illegal immigrants?” one X user wrote in response to Musk’s report. 

So let me get this straight; places like North Carolina and Maui get a pittance because FEMA says they lack funds, so we have to send our Military there to do work that could be put into the local economies. Meanwhile FEMA blows its budget on housing illegal immigrants?

— MrsNesbitt (@MrsNesbitt17) February 10, 2025

While illegals have lived ‘the American Dream’ on the taxpayers’ dime, residents across Western North Carolina have only now begun receiving FEMA assistance amid the ongoing recovery from Hurricane Helene.

Many of these folks in North Carolina had limited to no FEMA assistance under the Biden-Harris regime. That all changed after President Trump entered the White House on January 20. 

A message from Appalachia to California …#DontForgetAppalachia pic.twitter.com/JWsjyWpR0B

— Boone Cutler 🦬🇺🇸 🦅 (@boonecutler) January 11, 2025

So what comes next for the DOGE team?

While hardworking Americans struggle to afford basic necessities, FEMA is blowing $59M on luxury hotels for illegals. This is a slap in the face to every taxpayer. pic.twitter.com/4Ro9sqRUZw

— Chaotic Genius (@realchaosgenius) February 10, 2025

. . . 

Authored by Steve Watson via Modernity.news,

The US Army just recorded 12 year high recruiting numbers. Why? Well possibly because the military is no longer advertising itself as some sort of LGBTQ+ activist Summer camp.

Take a look at this US Army ad promoting health and fitness training, featuring a sergeant doing dead lifts and declaring, “Strong people are harder to kill.” 

Then compare it to an Army ad under the Biden regime where a cartoon soldier called Emma talks about being raised by two lesbian mothers and “marching for equality” as a child in order to ‘defend freedom’

Army recruiting ad under Biden: girl with lesbian moms “shattering stereotypes” and marching for BLM and LGBTQ pride

Army recruiting ad under Trump: masculine dude working out saying strong people are harder to kill

AMERICA IS SO BACK 🇺🇸🇺🇸🇺🇸 pic.twitter.com/CO2n8Rnu6r

— Libs of TikTok (@libsoftiktok) February 9, 2025

Different vibe.

The clown show is over 👍 pic.twitter.com/3DUWdbVtcE

— NomNom (@OmNomNomPL) February 9, 2025

How many millions did the producers of that cartoon shit get from USAID?

— Leftwaffen-Watch ⬜️ (@LeftwaffenWatch) February 9, 2025

Gee I wonder why Biden’s ad didn’t work?🤦‍♀️

— Kim devito (@patriot532) February 9, 2025

No, they just want to send the boys off to to dei in a foreign war

— Human.Revolted (@fun_it_was) February 10, 2025

DEI at the Pentagon is dead. The new Defense Secretary Pete Hegseth recently circulated a memo stating that ‘cultural awareness’ and ‘identity’ dates will no longer be recognised.

The President’s guidance (lawful orders) is clear: No more DEI at @DeptofDefense.

The Pentagon will comply, immediately.

No exceptions, name-changes, or delays. pic.twitter.com/KwRtxYRIbG

— Pete Hegseth (@PeteHegseth) January 26, 2025

Pentagon announces all official support of Identity Months are “dead” at DoD. “including National African American/Black History Month, Women’s History Month, Asian American and Pacific Islander Heritage Month, Pride Month, National Hispanic Heritage Month, National Disability… pic.twitter.com/AiAhp6FgBU

— Andrew Leyden (@PenguinSix) February 1, 2025

Hegseth has also directed staff to create a DEI task force to make sure all such programs are erased from the Pentagon.

PETE HEGSETH — DEI IS NOW DEAD IN THE U.S. MILITARY.pic.twitter.com/58q2XJLBmC

— Citizen Free Press (@CitizenFreePres) January 30, 2025

“We’re not joking around,” Hegseth said in an interviews last week, adding “There’s no changing of names or softly manipulating something. DEI is gone.”

SecDef Hegseth: “There is no hedging, no changing of names, or softly manipulating something. DEI is GONE. We are ripping it out root and branch, and getting back to the basics with high standards.” pic.twitter.com/jisT9PbxKY

— TheBlaze (@theblaze) January 29, 2025

President Trump also signed an executive order last month declaring that individuals with a “gender identity” contradicting their biological sex do not meet the necessary standards for military service. 

The order effectively bans transgender-identifying individuals from enlisting and serving, and Rasmussen finds that it is  supported by 54 percent of Americans.

Most Voters Support Trump’s Military Transgender Ban

By a 13-point margin, more voters approve than disapprove of President Donald’s Trump policy of removing transgender people from the U.S. military.

More At Rasmussen Reports:https://t.co/GVvpReNju1 pic.twitter.com/yZv3F8925l

— Rasmussen Reports (@Rasmussen_Poll) February 5, 2025

The order states that “Beyond the hormonal and surgical medical interventions involved, adoption of a gender identity inconsistent with an individual’s sex conflicts with a soldier’s commitment to an honorable, truthful, and disciplined lifestyle, even in one’s personal life.”

“A man’s assertion that he is a woman, and his requirement that others honor this falsehood, is not consistent with the humility and selflessness required of a service member,” it continues.

“For the sake of our Nation and the patriotic Americans who volunteer to serve it, military service must be reserved for those mentally and physically fit for duty,” the order further states.

It concludes that “The Armed Forces must adhere to high mental and physical health standards to ensure our military can deploy, fight, and win, including in austere conditions and without the benefit of routine medical treatment or special provisions.”

Hegseth recently announced that US Army recruiting goals have been far surpassed, and they have recorded the most successful enlistment numbers in over a decade.

BREAKING: In December 2024, the @USArmy had its best recruiting number in 12 years.

In January 2025, the Army hit its best recruiting number in 15 YEARS.

BOTTOM LINE: America’s youth want to serve under the bold & strong “America First” leadership of @realDonaldTrump.

— Pete Hegseth (@PeteHegseth) February 4, 2025

Clearly this is the fallout of not only the expulsion of diversity nonsense, but also seeing service members being deployed in securing the border and protecting the country, rather than being shipped overseas to engage in pointless foreign conflicts.

*  *  *

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US equity futures are higher, led by Tech as investors largely ignored tariff headlines, in this case the 25% tariffs on steel/aluminum which were announced yesterday, and which will predominantly impact both Canada and Mexico. As of 8:00am ET, S&P futures are 0.5% higher, reversing half of Friday’s drop as the tariff news lifted American metals stocks, with US Steel Corp. surging as much as 15% in premarket. Alcoa Corp. rallied 5%. Nasdaq futures are up 0.6%, with Mag7 names all higher ex-TSLA with Semis and Financials catching a bid. Bond yields are mostly unchanged with USD higher. Commodities are seeing strength across the entire complex with gold’s record run continuing, now above $2900. Today’s macro data focus is on the NY Fed’s 1-year inflation expectation given the hotter print on Friday from Univ of Mich; CPI is on Weds.

In premarket trading, McDonald’s rose 2% as sales rose in the fourth quarter after growth in the chain’s international business made up for a decline in the US. Meta once again led gains for the Mag7 group. Meanwhile, shares in Tesla are set to extend losses for a fourth session(GOOGL +0.6%, AMZN +0.4%, AAPL +0.5%, MSFT +0.6%, META +0.6%, NVDA -0.05% and TSLA -1.6%). Aluminum and steel company shares rose as President Donald Trump plans to impose 25% tariffs on all imports of the metals into the country (Alcoa (AA) climbs 5% and Century Aluminum (CENX) jumps 10%). Steel firms moving higher include: Cleveland-Cliffs (CLF) +8%, US Steel (X) +5%, Steel Dynamics (STLD) +6%.
Aspen Technology (AZPN) falls 2% as Emerson said the $265 per share price offer for the company is Emerson’s best and final price. Here are some other notable premarket movers:

• Axsome Therapeutics (AXSM) rises 13% after announcing it has entered into a settlement agreement with Teva Pharmaceuticals resolving patent litigation.
• Charles Schwab Corp. (SCHW) falls 2% as Toronto-Dominion Bank plans to exit its equity investment in the company.
• Hain Celestial (HAIN) declines 6% after reporting 2Q adjusted earnings per share that missed the average analyst estimate.
• On Semi (ON) tumbles 8% after reporting quarterly revenue that missed the average analyst estimate.
• Playa Hotels & Resorts (PLYA) rises 2% after Hyatt Hotels agreed to buy the company for about $2.6 billion
• Pliant Therapeutics (PLRX) slumps 62% after the company voluntarily paused enrollment and dosing of a trial of bexotegrast in patients with idiopathic pulmonary fibrosis.
• Semtech (SMTC) plunges 27% after the chipmaker said sales of the company’s CopperEdge products are expected to be lower than management’s “floor case” estimate due to rack architecture changes.

Trump’s intention to announce a 25% levy on steel and aluminum Monday added to already tense sentiment before Fed Chair Jerome Powell’s semiannual congressional testimony and the US President’s possible unveiling of reciprocal tariffs on “everyone” this week. Trump said the metals tariffs would apply to imports from all countries, though he didn’t specify when they would take effect.

“Our view in tariffs remain that they will cause volatility, are a negotiating tool and will eventually be not as bad as feared,” said Mohit Kumar at Jefferies International.

The dollar strengthened and gold hit a record high as Trump’s latest plan for steel and aluminum import tariffs brought fresh disruption to markets. The yen and the Canadian dollar were the main losers against the greenback as the Bloomberg Dollar Spot Index rose to its highest in nearly a week. Like the dollar, bullion climbed as the president’s latest trade threats helped boost demand for haven assets. 

Separately, Trump said Elon Musk’s government efficiency team has found irregularities while examining data at the US Treasury Department. Benchmark 10-year Treasuries were steady.

There are a number of key events on the radar in coming days, including Powell’s speech and US CPI data.
Powell will deliver his semi-annual testimony at a time when officials are signaling they’re not in a hurry to further ease policy. Nonfarm payrolls moderated last month and revisions show US job gains were softer but still solid in 2024. Inflation data due this week may help buttress those arguments and underpin market pricing for just one Fed rate cut this year.

In Europe, the Stoxx 600 rose 0.3% with real estate, energy and telecommunication stocks among the best performers. Basic resources provide a drag due to the aforementioned metal tariffs. BP Plc shares surged the most since 2020 as Bloomberg News reported that activist investor Elliott Investment Management had built a stake in the oil company. Here are the most notable European mover:

• BP shares rise as much as 7% after Bloomberg reported that activist investor Elliott has built a significant stake and is pushing the company to consider transformative measures.
• Spectris shares advance as much as 4.7% after JPMorgan upgrades the high-tech instrument maker to overweight, with a Street-high price target.
• ITV shares rise as much as 3%. Major shareholders in the broadcaster’s management support efforts to explore a deal for its production arm, the FT reported Sunday, corroborating earling reports.
• Drax shares gain as much as 5.9% after the renewable energy company agreed to a four-year low carbon dispatchable contract with the UK government for Drax Power Station.
• Talgo shares gain as much as 8.5%, after Poland’s PFR said it intends to submit a proposal that would entail a takeover bid for 100% of the Spanish trainmaker.
• Telkom shares climb as much as 8.1% in Johannesburg after the telecommunications company said its 3Q Ebitda rose 28% on continued operational efficiency gains from cost optimization initiatives.
• Cloetta shares rise as much as 5% to hit their highest level since September 2021 after the confectionery company decided not to proceed with a planned greenfield investment in the Netherlands due to “increased risk relating to energy supply and the still on-going permitting process.”
• IAG shares drop as much as 3.5% after Goldman Sachs cut the stock to neutral from buy after the British Airways owner’s shares outperformed peers since its upgrade last January.
• Rockwool shares fall as much as 5% as UBS cuts its rating to sell as the stone-wool producer faces a normalization of margins.
• GTT shares fall as much as 7.3% after the French engineering firm announced job cuts at its Elogen hydrogen unit, as well as the departure of CEO Jean-Baptiste Choimet.
• Gerresheimer shares slip as much as 1.4%, paring some of Friday’s 9.5% surge, on news that the company is in early-stage talks with private equity investors on a potential takeover.
• Safestore and Shurgard Self Storage both decline after being downgraded by analysts at Morgan Stanley, who argue the pair are unlikely to lead in any sector recovery.

Earlier in the session,  Asian stocks dropped on concern US President Donald Trump’s plans for tariffs on all imports of steel and aluminum will add to a growing trade war. Hong Kong shares rose for a third day amid optimism toward the tech sector. The MSCI Asia Pacific Index fell as much as 0.5%, with TSMC the biggest drag on the benchmark. Shares in Taiwan and Australia dropped, while Japanese stocks were mixed. A gauge of Chinese tech shares listed in Hong Kong jumped more than 2% as the nation’s growing artificial intelligence capability fueled optimism on the beaten-down sector. Sentiment was also boosted by Trump’s decision to delay suspension of the “de minimis” exception, boosting e-commerce shares.

“This is actually a very good reminder for global investors to look at the innovation capabilities of some of the Chinese players,” Jin Yuejue, a multi-asset solutions investment specialist at JPMorgan Asset Management, said on Bloomberg Television. “We are very much monitoring the National People’s Congress coming up, whether there will be more fiscal impulse that’s going to be announced.”

In FX, the Bloomberg Dollar Spot Index inched up 0.2%, while commodity currencies pared earlier declines, after US President Donald Trump said he would announce 25% tariffs on all imports of steel and aluminum. “Markets are becoming incrementally less sensitive to these headlines,” said Laura Cooper, global investment strategist at Nuveen. “It’s not clear whether this is a negotiating tool to get a deal.” The Japanese yen is the weakest of the G-10 currencies, falling 0.6% against the greenback and taking USD/JPY above 152. EUR/USD steadied around 1.0326; Options markets suggest traders are positioning for a fresh round of euro weakness fueled by widening tariff-risk premiums.The Canadian dollar also underperformed with a 0.3% decline. 

In rates, treasuries are mixed in early US trading Monday, holding most of Friday’s yield increases sparked by the January jobs data. 10Y yields are at 4.40%, unchanged from Friday; most yields remain within 2bp of closing levels from Friday with the curve steeper; 2s10s and 5s30s spreads are wider for first day in five. Treasury auctions begin Tuesday with 3-year notes and include 10- and 30-year new issues over subsequent two days. With no major US economic data slated before the CPI report Wednesday, Treasury and corporate bond supply may be the main driver of flows, along with reaction by other markets to President Trump’s latest tariff threats. Gilts rise and outperform their German counterparts with UK 10-year yields falling a basis point to 4.46%.

In commodities, WTI crude oil rose 1.5% to trade at $72, near session highs. Gold prices soared $41 to a record high above $2,900. Bitcoin rose 3% to near $98,000. Elsewhere in commodities markets Monday, European natural gas prices rose to a two-year high as colder temperatures accelerate the depletion of the region’s storage facilities. Benchmark futures rose as much as 4.1% to the highest since February 2023. Aluminum futures in London — the global benchmark — were steady as traders waited for more details on when and how the latest tariffs would operate. Copper was little changed.

The US economic data calendar includes only NY Fed 1-Year inflation expectations at 11am New York time. Fed speaker slate is blank; Chair Powell is slated to give congressional testimony over the next two days

Market Snapshot

• S&P 500 futures up 0.4% to 6,071.50
• STOXX Europe 600 up 0.3% to 544.21
• MXAP down 0.3% to 185.10
• MXAPJ little changed at 582.75
• Nikkei little changed at 38,801.17
• Topix down 0.2% to 2,733.01
• Hang Seng Index up 1.8% to 21,521.98
• Shanghai Composite up 0.6% to 3,322.17
• Sensex down 0.7% to 77,340.86
• Australia S&P/ASX 200 down 0.3% to 8,482.78
• Kospi little changed at 2,521.27
• German 10Y yield little changed at 2.37%
• Euro little changed at $1.0333
• Brent Futures up 1.0% to $75.42/bbl
• Gold spot up 1.4% to $2,900.86
• US Dollar Index up 0.10% to 108.15

Top Overnight News

• Trump on Sunday said the US would impose 25% tariffs starting Mon on steel and aluminum imports, with his reciprocal tariff announcement arriving Tues or Wednesday. WSJ
• US House Republican leaders are looking to cut federal spending by USD 2tln to USD 2.5tln, according to Punchbowl sources. House GOP negotiators now believe they will have to dig deeper into Medicaid spending to meet those targets. Punchbowl believe Washington is drastically underestimating the chance for a government shutdown after March 14.
• Trump announced he is revoking security clearances for former President Biden and stopping his daily intelligence briefings, while he stated that there was no need for Biden to have continued access: RTRS
• Trump said he instructed the Secretary of the US Treasury to stop producing new pennies which is wasteful, while he suggested tearing the waste out of the US budget, even if it’s a penny at a time: RTRS
• Trump’s acting head of the consumer finance watchdog told staff to stop pending investigations and supervisory activities of banks: WaPo
• US House Speaker Johnson said he will push the ‘one big bill’ strategy for passing US President Trump’s tax cut agenda and Republicans will find offsets to pay for Trump’s tax cut plans: Fox
• Chinese officials are building a list of U.S. technology companies that can be targeted with antitrust probes and other tools, hoping to influence the tech executives who are heavily represented in President Trump’s orbit. WSJ
• China’s consumer inflation accelerated for the first time since August, rising 0.5% in January from a year earlier, driven by holiday spending. Factory deflation persisted with a 2.3% decline. BBG
• China’s retaliatory tariffs went into effect on Mon 2/10, although a White House official said the US could pause its recent 10% duty imposition if progress occurs on fentanyl when Trump and Xi speak this week. WSJ
• Indian Prime Minister Narendra Modi is preparing additional tariff cuts ahead of a meeting this week with U.S. President Donald Trump that could boost American exports to India and avoid a potential trade war. RTRS
• UK companies are paring back job postings at the steepest pace since the midst of the pandemic in 2020, and increasingly turning to redundancies. BBG
• France will announce a total of €109 billion in AI investments over the next few years, Emmanuel Macron told France 2 TV before today’s summit in Paris. BBG
• Democrats warn they are willing to have a government shutdown unless Trump and Musk dial back their aggressive overhaul of the federal government. NYT
• Canada will reach out to US states with which it has significant trade relationships to persuade America to drop its tariff plans. BBG

Tariffs

• US President Trump said they will be announcing on Monday 25% tariffs on all steel and aluminium coming into the US and he will announce reciprocal tariffs on Tuesday or Wednesday which will go into effect almost immediately, while he added that no one can have a majority stake in US Steel (X).
• US President Trump said on Friday that he will make an announcement in the week ahead on reciprocal trade with many countries, while he added that tariffs are an option to address deficit and auto tariffs are always on the table. Furthermore, Trump said they will meet on reciprocal tariffs on Monday or Tuesday and have an announcement.
• Chinese officials may target Broadcom (AVGO) and Synopsys (SNPS) with probes and are building a list of US tech firms for potential probes, according to WSJ.
• Japanese PM Ishiba expressed optimism on Sunday that Japan could avoid higher US tariffs as noted that President Trump had “recognised” Japan’s huge investment in the US and the American jobs that it creates.
• Australian PM Albanese said Australia will urge the US to give Australia exemption over steel tariffs.
• Indian PM Modi is prepared to discuss reducing import tariffs and buying more energy and defence equipment from the US when he meets with US President Trump next week, according to Indian officials cited by Bloomberg.
• German Chancellor Scholz said the EU could act in an hour when asked in a pre-election debate if the EU was prepared for possible US tariffs.

d

 

A more detailed look at global markets courtesy of Newsquawk

APAC stocks saw mixed price action as participants reflected on last Friday’s NFP print and President Trump’s latest tariff remarks in which he stated they will be announcing on Monday 25% tariffs on all steel and aluminium coming into the US and will announce reciprocal tariffs on Tuesday or Wednesday, while China’s retaliatory tariffs against the US took effect. ASX 200 declined with the index led lower by underperformance in tech and telecoms, while miners also suffered owing to the US tariff threat although Australia will urge the US to give Australia exemption over steel tariffs. Nikkei 225 retreated at the open but the clawed back its losses as a weaker currency provided a cushion and with some optimism from Japanese PM Ishiba that Japan could avoid higher US tariffs following his recent meeting with US President Trump. Hang Seng and Shanghai Comp were positive following the recent CPI data from China which showed an acceleration and with the outperformance in Hong Kong led by notable strength in tech and telecom stocks. Nonetheless, the gains in the mainland were limited by the tariff and trade frictions after China’s retaliatory tariffs against the US took effect and with officials also said to be building a list of US tech firms for potential probes.

Top Asian News

• China appoints Zou Lan as deputy PBoC Governor.
• Shein reportedly asked China suppliers to add production lines in Vietnam, according to Bloomberg.
• India’s Finance Minister Sitharaman said a new income tax bill will be introduced in parliament in the week ahead.

European bourses (STOXX 600 +0.4%) are modestly firmer across board, after a mixed APAC session overnight. European sectors hold a positive bias, but with the breadth of the market fairly narrow; Energy takes the top spot, lifted by gains in BP (+6%) after Elliott Management took an activist stake in the company. For the autos sector, it was reported on Friday that the EU is offering to lower tariffs on US car imports to avoid a trade war with the US. Mining names in Europe are generally on the backfoot today, with losses driven by commentary via US President Trump who said that he will be announcing 25% tariffs on all steel and aluminium coming into the US.

Top European News

• German Economy Ministry spokesperson said they are doing everything they can to avoid tariff increases
• Maersk (MAERSKB DC) said the security risk for commercial vessels in the Red Sea and Bab-el-Mandeb strait remains high, will continue to sail via The Cape of Good Hope until safe passage through the area is ensured.
• European Commission said have not receive any official notification regarding imposition of additional tariffs on EU goods.
• French Foreign Minister, said “of course we will respond to Trump’s tariff announcement” and will call on the EU to respond to Trump tariffs.
• ECB de Guindos said it is very important to avoid a trade war, have to have prudent and intelligent approach regarding latest tariff announcement. Analysis regarding tariffs is that it leads to impact on supply, inflation is less clear. Have to take into account all factors on monetary policy. Decision on policy will be taken meeting-by-meeting, see inflation converging to the “our” goal
• UK Health Minister Andrew Gwynne was fired by PM Starmer over his WhatsApp messages which insulted constituents, fellow MPs and councillors.
• French President Macron said France will announce during the Paris AI summit opening on Monday EUR 109bln investments in AI over the coming years.
• Germany’s election front-runner Merz said he was open to reforming Germany’s borrowing rules amid pressure regarding defence spending financing, according to the FT.

FX

• DXY has started the week off on the front foot in the wake of Friday’s NFP report and weekend trade developments. On the latter, US President Trump said he will announce 25% tariffs on all steel and aluminium coming into the US on Monday and unveil reciprocal tariffs on Tuesday or Wednesday which will go into effect almost immediately. Today’s docket sees the release of US employment trends and NY SCE. DXY briefly eclipsed Friday’s 108.31 high with a session peak at 108.44.
• EUR is steady vs. the USD with the week commencing on a negative footing when it comes to trade; EU remains in Trump’s sights, but the FT reported late last week that the EU is set to offer lower tariffs on US cars. EUR/USD briefly made its way onto a 1.02 handle with a session low at 1.0281 before returning back above the 1.03 mark – ECB’s Schnabel and President Lagarde are due.
• GBP is a little firmer today vs the USD and EUR, but with UK specific newsflow fairly light thus far; all focus will be on BoE’s Mann – she has traditionally been an arch-hawk, so her remarks will be of great importance for any insight on her decision to opt for a 50bps cut vs expectations of a 25bps reduction. Cable currently sits in a 1.2370-1.2414 range.
• JPY is the laggard vs the Dollar. On the weekend, PM Ishiba expressed optimism on Sunday that Japan could avoid higher US tariffs. As it stands USD/JPY trades towards the upper end of a 151.25-152.53 range; further upside could see a test of its 200 DMA at 152.76 and then its 100 DMA at 152.97 thereafter.
• Antipodeans are mixed, with slight outperformance in the Aussie, which is outmuscling the Kiwi in the AUD/NZD cross; the Antipodes were initially hampered by the Trump tariff announcements, but the downside has seen waned as the Dollar gave back the initial upside. Australian PM Albanese said Australia will urge the US to give Australia exemption over steel tariffs.
• PBoC set USD/CNY mid-point at 7.1707 vs exp. 7.3050 (prev. 7.1699).

Fixed Income

• USTs are essentially flat and with price action rangebound thus far, trading within a very narrow 109-02+ to 109-09 range; markets are digesting the jobs report on Friday as well as fresh tariff announcements from President Trump regarding 25% levies on all steel and aluminium coming into the US (more details on Monday). Today’s docket sees the release of US employment trends and NY SCE.
• Bunds marginally higher in what has been a recent run of consolidation for German paper. Macro focus for the broader EZ-region has been on the implications of Trump tariff threats over the weekend (detailed above). If the EU is finally dragged into the trade war in a material way, the market will likely focus on the negative growth implications for the region. Mar’25 Bunds are currently tucked within Friday’s 132.95-133.69 range with the corresponding 10-year yield towards the middle of the 2.35-2.40% range. ECB President Lagarde is due to speak later today.
• UK paper a touch higher after an indecisive session on Friday. Global trade is the main macro focus today for global markets, however, it remains to be seen how much of a negative this will be for the UK given that rhetoric towards the UK from the Trump administration has been tempered on account of Trump’s relationship with PM Starmer and the lack of goods trade imbalances between the two nations. Mar’25 Gilts are currently tucked within Friday’s 92.94-93.87 range; BoE’s Mann (who surprisingly voted for a 50bps cut last week) is due to speak later.

Commodities

• A firmer session for the crude complex thus far, with upside facilitated by US President Trump’s tariff announcement on steel/aluminium, and as markets await reciprocal tariffs on Tuesday/Wednesday. In geopolitics, Trump commented that he spoke with Russian President Putin regarding ending the Ukraine war although offered very few details including when the call took place. WTI sits towards the upper end of a USD 70.84-71.86/bbl range.
• Firmer trade across contracts with European Nat Gas rising to a two-year peak to levels last seen in February 2023 – with desks citing colder temperature and tight storage.
• Precious metals are firmer with gold and silver both advancing to a similar degree, whilst Palladium is higher but to a lesser degree. Focus has been on the yellow-metal, which once again printed a fresh ATH, this time above USD 2900/oz; current peak at USD 2,906.25/oz.
• Copper futures are subdued after rangebound APAC trade, with tariff concerns and implications continuing to weigh on sentiment in the complex. 3M LME copper resides in a USD 9,379.35-9,477.95/t range at the time of writing.
• Iraq set Basrah medium crude official selling price to Asia at a premium of USD 2.65/bbl vs Oman/Dubai average and to Europe at a discount of USD 1.25/bbl vs Dated Brent, while it set the OSP to North and South America at a discount of USD 0.65/bbl vs ASCI, according to SOMO.
• Estonia, Latvia and Lithuania have completed decoupling from the Russian power grid as planned and successfully synchronised their electricity systems to the European continental power grid.
• Indian LNG buyers are said to be in talks for more US supply ahead of Indian PM Modi’s trip to the US, according to Bloomberg.
• India’s Oil Secretary said Indian oil companies open to buy stake in US LNG projects.

Geopolitics: Middle East

• “Negotiations for the second phase of the Gaza agreement have not started and Netanyahu has broken their date due to his visit to the United States”, according to Sky News Arabia citing Hamas leader. “Hamas leader Musa Abu Marzouq told Sky News Arabia: We expect that the negotiations will proceed and take their normal course”.
• Iranian Defense Minister said “It is not possible to reach an agreement with the current US government on the nuclear agreement”, via Sky News Arabia.
• Israeli PM Netanyahu dispatched a delegation to Qatar’s Doha for the next phase of ceasefire talks.
• Israeli military said operations in the northern West Bank expanded to Nur Shams, while it added that several terrorists were killed and wanted suspects were detained. It was separately reported that Israel’s army confirmed it received three hostages and said it struck a Hamas weapons depot in Syria.
• US President Trump said he is committed to buying and owning Gaza and may give sections to other states in the Middle East to rebuild it, while he added that they will make Gaza into a good site for future development. Trump also said that he will be meeting with Saudi Arabia’s Crown Prince MBS and Egyptian President Sisi, as well as noted that Middle Eastern nations will take Palestinians after those nations speak to him.
• Hamas official condemned US President Trump’s remarks on Gaza ownership and said that Palestinians will foil all displacement plans, according to Reuters.
• Turkish President Erdogan said that they have no need to discuss or take seriously US President Trump’s Gaza plan, while he added that no one has the power to remove the people of Gaza.
• Qatar condemned statements by Israeli PM Netanyahu on establishing a Palestinian state inside Saudi territory.
• Iran’s Supreme Leader Khamenei met with visiting top Hamas leaders in Tehran.
• Egypt’s Foreign Minister heads to Washington for talks with US officials, according to AFP.

Geopolitics: Ukraine

• US President Trump said on Friday that he has spoken to Russian President Putin by phone regarding ending the Ukraine war, according to the New York Post.
• US President Trump said he does not want to talk about his conversation with Russian President Putin but believes they are making progress and expects to have more conversations with Putin. Furthermore, Trump declined to say when they talked and noted that he would meet with Putin in person at the right time, according to Reuters.
• Russia’s Kremlin said it can neither confirm nor deny publications regarding the Putin-Trump conversation, while Russia’s envoy to the UN said Russia awaits appropriate signals from the US regarding contacts with Moscow and that Russia has not yet seen positive steps from the new US administration on disarmament, according to RIA.
• Russian Deputy Foreign Minister said Russia has not received any satisfactory proposals to start talks on Ukraine and statements by the West and Ukraine about an immediate start on talks are nothing but buzz building, according to RIA.
• Russian Defence Ministry said Russian forces captured Orikhovo-Vasylivka in eastern Ukraine, while it was also reported that Russia said its troops repelled three Ukrainian counterattacks in the Kursk region.
• Russia launched a drone attack on Ukraine’s capital Kyiv, according to the Mayor.

Geopolitics: Other

• North Korean leader Kim said the trilateral cooperation among the US, Japan and South Korea is raising a grave security challenge. It was also reported that North Korea noted its nuclear weapons are not a bargaining chip and that its nuclear forces are meant for combat against enemies that threaten global peace, according to KCNA.

US Event Calendar

• 11:00: Jan. NY Fed 1-Yr Inflation Expectat, prior 3.00%

DB’s Jim Reid concludes the overnight wrap

The week after payrolls is usually quiet but due to the first Friday of the month being the latest it could possibly be this month, then we bump straight into US CPI (Wednesday) week, with PPI (Thursday) for an added bit of inflationary sparkle. Outside of this the main highlight will be Powell’s semi-annual monetary policy testimony before the Senate Banking Committee (tomorrow) and the House Financial Services Committee (Wednesday). The latter comes after CPI which will possibly spread the interest level over the two appearances rather than most of the focus being on the first as per usual. Elsewhere in the US, watch out for the NY Fed inflation expectations series today after a stronger equivalent from the University of Michighan survey just before the weekend on Friday. After that we wait until this Friday for the other important US data, namely retail sales and industrial production.

In Europe we have the UK Q4 GDP reading on Thursday following last week’s BoE meeting (our UK economist’s recap is here). Elsewhere in the region, January CPIs are due in Denmark and Norway today, and Switzerland on Thursday. In terms of earnings we have 75 S&P 500 companies and 79 Stoxx 600 companies reporting.

The tariff news will clearly continue to dominate the agenda all week, especially after Mr Trump announced on Friday that he’d be holding a press conference early this week on the US plans for equalising tariffs on “reciprocal trade” with an added mention for autos. Then on Air Force One last night Mr Trump said he would put 25% tariffs on steel and aluminium imports later today. Canada, Mexico and Latin America would be the most impacted given that’s where the US imports most of these goods from.

Looking forward now and in terms of Powell’s testimonies this week, the overarching message is likely that the Fed is not in a hurry to cut rates at the moment, with Friday’s payrolls and to a lesser extent the UoM inflation expectations series the latest support to that message. Even though headline (+143k) and private (+111k) payroll gains were below expectations, net upward revisions of 100k over the prior two months, a decline in the unemployment rate to 4.0% (4.1% expected), and average hourly earnings +0.5% on the month (vs. +0.3% expected), made it a hawkish report.On top of that, the annual benchmark revision to the level of March 2024 nonfarm payrolls (-598k final vs. -818k preliminary) was not as large as the BLS had previously projected. See our economists’ US employment chart book here for everything you wanted to know about the labour market post this release.

For those inflation expectations last Friday the 1yr level was up to 4.3% (expected 3.3%) and the more important 5-10yr one at 3.3% (expected 3.2%). If confirmed in the final reading the longer-term expectations have only been higher for one month (June 2008) since 1995. This series continues to be ridiculously partisan post the election though with the 1-yr number seen around 5% from Democrat supporters and around zero for Republicans. So how reliable this number is at the moment is open is debatable.

Talking of inflation, strong seasonally adjusted gains in food and energy prices should keep headline CPI (+0.31% forecast vs. +0.39% previously) above core (+0.28% vs. +0.23%). YoY headline CPI should remain roughly steady at 2.9%, while that for core would just round down to 3.1%. OER will continue to be a big focus. For PPI it‘s as ever the components that go into core PCE that will gain all the attention.

Continuing with inflation, on Sunday data from China showed that consumer inflation (+0.5% y/y) accelerated at its fastest in five months in January (v/s +0.4% expected), up from December’s +0.1% increase, mainly because of the brisk consumption seen in the recently concluded Spring Festival holidays. At the same time, producer price deflation persisted as the PPI (-2.3% y/y) fell for a 28th consecutive month. The decline was marginally faster than Bloomberg’s estimate of -2.2% while matching December’s contraction.

Chinese risk is doing well this morning with the Hang Seng (+1.80%) leading the way with the Shanghai Composite (+0.50%) also higher. Other markets are a bit more subdued with the Nikkei (+0.20%) and the KOSPI (+0.13%) swinging between gains and losses. S&P 500 (+0.32%) and NASDAQ 100 (+0.60%) futures are rebounded after a weak Friday session. The yen (-0.31%) is retreating from a two-month high, trading at 151.88 against the dollar, with 10yr JGB yields +1.8bps higher at 1.32%, the highest since 2011.

Last week saw markets experience a steady overall performance, but one that was bookended by tariff-related news. At the start of the week, the imposition and then delay to tariffs on Mexico and Canada saw the S&P 500 first fall sharply but then close less than 0.6% beneath its all-time high by Wednesday. The index then fell -0.95% on Friday (and -0.24% over the week) as news broke of US reciprocal tariff plans on Friday. Tech stocks were a particular underperformer, with the Mag-7 down -2.79% (-1.95% Friday) as Alphabet’s and Amazon’s results underwhelmed. However in Europe, the STOXX 600 was up +0.60% (-0.38% Friday), having hit an all-time high on Thursday. And there was also a strong performance for emerging markets, with the MSCI EM index up +1.38% (+0.57% Friday).

The hawkish data on Friday led investors to dial back their expectations for rate cuts this year, with just 36bps now priced in by the December meeting, which is the fewest in over three weeks and a turnaround from the 50bps priced intra-day on Wednesday. This helped trigger a significant selloff for Treasuries at the end of the week, which saw the 10yr yield up +6.1bps on Friday to 4.50%, even though the 10yr yield was still down -4.5bps over the week as a whole. In Europe, 10yr bund yields fell -8.8bps last week to 2.37%, including a -0.7bps decline on Friday as tariff risks outweighed the read-across from stronger US data.

By Jesse Colombo of The Bubble Bubble Report

The current gold bull market began in the spring of 2024, fueled in large part by aggressive Chinese futures traders on the Shanghai Futures Exchange (SHFE), while Western investors remained largely on the sidelines. In just six weeks between March and April, these traders propelled gold prices up by $400, or 23%—an extraordinary surge for the yellow metal. Since then, their activity has quieted, but I’ve anticipated their return, expecting them to push gold to truly staggering levels. That moment may have arrived. Fresh off the week-long Chinese Lunar New Year holiday, these traders are reentering the market—just as gold was already heating up without them.

The Shanghai Futures Exchange gold futures were the primary vehicle behind the spring 2024 gold frenzy, a surge that subsequently spilled over into international gold prices:

A fascinating Financial Times article from that time titled “Chinese Speculators Super-Charge Gold Rally” highlighted how trading volume in SHFE gold futures had surged by 400%, propelling gold prices to record highs:

The spring Chinese gold trading frenzy can also be seen in the chart of long open interest in SHFE gold futures:

Over the past year, SHFE gold futures have mirrored the international gold price, steadily rising before consolidating in a trading range from late October to January. But as soon as China’s financial markets reopened this week after the Lunar New Year holiday, SHFE gold futures gapped higher, swiftly catching up to the international rally that unfolded while China was offline. This breakout signals strong bullish momentum, suggesting even greater gains lie ahead.

The trading range and recent breakout are also evident in the international spot gold price denominated in Chinese yuan, providing further confirmation of the bullish trend:

As I had anticipated back in December, the spot price of gold in U.S. dollars also recently broke out of a triangle consolidation pattern, confirming the bullish momentum:

I believe all the key ingredients for another China-driven gold mania—similar to last spring—are now in place. It may only be a matter of time. A key indicator to watch is trading volume in SHFE gold futures, which you can track on TradingView under the symbol AU1!. Last spring, a surge in volume accompanied gold’s explosive rally. So far, volume has remained subdued, but it’s likely to increase as the rally gains momentum. For confirmation, I’m looking for a significant spike in volume to validate this thesis.

Another key indicator of a potential Chinese gold mania is whether the domestic Chinese gold price trades at a premium to the international price. During last spring’s explosive rally, the domestic price carried a premium of approximately $50 over the international price. Currently, there is little to no premium or discount, but it’s worth watching closely. If a significant premium emerges, it would likely signal that Chinese demand is once again driving gold higher.

A major catalyst for a potential Chinese gold mania is the country’s severe economic turmoil. With its real estate and stock markets plunging, an estimated $18 trillion in household wealth has been wiped out—an economic crisis akin to China’s version of the 2008 Great Recession. Meanwhile, government bond yields have collapsed to record lows, signaling a deepening deflationary spiral. In low-interest-rate environments like China’s, gold— which generates no yield—becomes more attractive as the opportunity cost of holding it diminishes. Additionally, China is likely to respond with a massive stimulus “bazooka” to combat deflation, which should provide a powerful tailwind for gold, silver, and other commodities.

Another potential catalyst for a Chinese gold mania is the People’s Bank of China’s (PBOC) recent resumption of official gold purchases after a six-month pause. As I recently explained, the PBOC was likely accumulating gold all along, but its decision to publicly announce renewed purchases appears to be a strategic move aimed at encouraging domestic gold buying. This aligns with China’s broader strategy of diversifying away from U.S. dollars and increasing gold holdings across all levels of society.

All signs point to the potential for another explosive gold rally driven by Chinese traders, much like what unfolded last spring. With SHFE gold futures breaking out, the possibility of rising trading volumes, and the return of a Chinese gold price premium, the conditions for another bullish episode are falling into place. China’s economic crisis, record-low bond yields, and the looming prospect of massive stimulus only strengthen the case for gold’s continued ascent. Meanwhile, the PBOC’s renewed gold purchases reinforce the broader shift toward gold as a preferred asset. If these factors align as expected, the next phase of this bull market could be even more dramatic than what we saw in 2024.

If you found this report valuable, click here to subscribe to this popular newsletter for just $15 a month—less than 50 cents a day—to stay informed and gain deeper insights into the precious metals market and overall economy.

Authored by Bill Pan via The Epoch Times (emphasis ours),

President Donald Trump has ended his lawsuit against Twitter over the platform’s decision to ban him following the Jan. 6, 2021, breach of the U.S. Capitol.

In a notice filed Friday with the U.S. Court of Appeals for the Ninth Circuit, legal teams for both sides requested that the court dismiss Trump’s pending appeal. The notice did not say whether Elon Musk, who acquired Twitter and rebranded it as X, had agreed to any terms to resolve the case.

In July 2021, Trump filed separate cases against Twitter, Facebook, and Google’s YouTube over similar measures they took to restrict his use of those sites. Twitter said at the time that Trump’s messages—including one in which he stated he would not be attending incoming President Joe Biden’s inauguration—were “highly likely” to inspire more violence.

Trump’s lawsuits centered on free speech violations. While private companies ordinarily have no legal obligation to honor free-speech rights, the suits alleged that Twitter and other platforms were essentially acting as agents of Democratic members of Congress who wanted him deplatformed.

“Legislators … made it increasingly clear that they wanted President Trump, and the views he espoused, to be banned from Defendants’ platform,” the complaint alleged, citing multiple statements from Democratic lawmakers urging Big Tech to take action against Trump.

The suits were initially filed in Florida but were later moved to federal court in California at the companies’ request. In May 2022, a San Francisco judge dismissed the case against Twitter and its former CEO Jack Dorsey, ruling that Twitter was not acting as a government agent when it suspended Trump. Trump appealed the decision to the Ninth Circuit.

All three platforms eventually dropped the bans. Musk, a self-described free speech absolutist who is now a core adviser to Trump, restored Trump’s account in November 2022, just days after Trump announced his candidacy for the 2024 presidential race.

Attorneys for Twitter have argued that Trump’s case was moot since his account had been reinstated under Musk’s revised content moderation policies. However, the case lingered on, since at least two pro-Trump advocates who joined the lawsuit didn’t have their accounts restored.

Since winning reelection, Trump has secured favorable settlements with tech and media companies he accused of defaming or mistreating him.

In December 2024, ABC News agreed to pay $15 million toward Trump’s future presidential library to settle a defamation lawsuit over anchor George Stephanopoulos’s on-air claim that Trump had been found “liable for rape.” The settlement labeled ABC’s payment as a “charitable contribution” earmarked for the yet-to-be-built library.

In January, Meta agreed to pay $25 million to resolve Trump’s suit over his suspension from Facebook and Instagram. Approximately $22 million of that amount will go toward Trump’s presidential library, with the remainder covering legal fees and other plaintiffs.

European natural gas prices surged to a two-year high as new weather models forecast an incoming cold snap across Northwest Europe this week, expected to linger through early next week. Another driver in the rally has been the bloc’s dwindling NatGas inventories, which remain well below critical seasonal averages, heightening supply concerns ahead of spring. 

The price of the Dutch TTF, the benchmark European NatGas, climbed as much as 5.4% on Monday to 58.75 euros a megawatt-hour – the highest level since February 2023. 

According to Bloomberg data, weather models forecast that average temperatures across Northwest Europe will begin sliding this week and reach a low of 29F by early next Tuesday. The average temperature for the region this time of year is around 40F.

The cold blast will increase NatGas demand and further drain stockpiles on the continent, which are already below 15-year averages. As of Saturday, EU NatGas storage facilities were about 49% full.

“The risk of the European Union entering the spring with very low gas inventories has increased in the last couple of weeks,” said Arne Lohmann Rasmussen, chief analyst at Global Risk Management, who Bloomberg quoted. 

Lohmann noted, “Not only has the front month spiked, but we have also seen a rise in 2026–2027 calendar prices.”

Traders also watch the risks of a broadening tariff trade war between President Trump and Brussels. On Sunday, Trump said he would soon introduce a 25% tariff on all steel and aluminum imports into the US.

French Foreign Minister Jean-Noel Barrot responded to Trump’s tariff threat, indicating the bloc should not hesitate to defend its interests. 

“Of course… This is already what Donald Trump did in 2018, and we responded. We will again respond,” Barrot said. 

In recent months, Trump has told Brussels to purchase more US LNG… 

“Trump could act as the LNG marketer-in-chief,” Anne-Sophie Corbeau, a global researcher at Columbia University’s Center on Global Energy Policy, said in a recent webinar. However, it remains to be seen how successful he will be in selling more LNG to Europe amid tariff wars. 

Since Russia invaded Ukraine in early 2022, Europe has been rejiggering its LNG supplies from Moscow to the US.

The EU may purchase more US LNG to satisfy Trump to resolve any trade disputes. 

Authored by Greg Hunter via USAWatchdog,

Former Wall Street money manager and financial analyst Ed Dowd of PhinanceTechnologies.com is back with a new report called “Danger of Deep Worldwide Recession in 2025.” 

The new report shows how a weak economy was propped up under the Biden Administration and how a crash, this year, is inevitable.  

Dowd says,

“What we are going to have going forward is the reversal of deficit government spending, which was juicing the economy with illegals.  

Some of them got jobs, but a lot of them got benefits.  They got housing accommodations.  The NGO system was flush with money to facilitate this massive, purposeful logistical operation.  People don’t understand that the net legal migration in the US is one million a year. That’s one million people a year.  The last four years, we brought in 10 million to 15 million people.  That is a new economic variable, and it distorted the economy. 

It never got us into expansion territory, but it papered over a lot of the ills we were seeing.  

Trump’s policies are going to reverse that all out. . . . The velocity of money under Joe Biden really started to rise. . . .  Illegal immigration is very inflationary...

In the fourth quarter, the velocity of money is already rolling over.  The Trump effect began the moment he was elected.  We’ve seen self-deportations.  We have seen new tenant rents plunge, and that’s what has been holding up the housing market.”

How bad is the economy going to get?  

Dowd predicts, 

“We are seeing a recession in 2025.  The rest of the globe is already starting to roll over.  It’s going to be a worldwide recession.  There is going to be a mini housing crisis.  Housing has been stagnant for the better part of the year.  There is no transaction volume, and nobody can afford homes.  We are hitting the 18-year housing cycle.  The last housing cycle was in 2007, and you add 18 years and you get 2025…

The economy for the middle-class is going down. . . . As time goes on, we are going to see GDP numbers go lower and lower and lower. . . . It’s kind of a perfect storm for the Trump Administration.  There is no way to avoid the pain.”

When can we expect things to get better?  

Dowd says, 

“This is much like Ronald Reagan in his first term.  He was elected with -2% real wages.  This was the same phenomenon going into the 2024 Election.  So, we are going to have a recession . . . Then, Trump gets his policies, and he has a very short window of opportunity to get all of his policies enacted.  If he does, we will be booming on the other side of this.”

Dowd still likes gold and thinks rates will begin going lower, which means locking in rates now will be a smart play for many.  

Dowd says, “Gold is good long term.”  

Dowd also thinks AI is over-bought and is in a bubble and points out, “There is no money on the other side,” of the AI boom.  

Dowd thinks AI tech will crash just like the internet bubble in early 2000.  

Dowd thinks, “AI prices are too expensive, and they will collapse at some point.”

There is much more in the 51-minute interview.

Join Greg Hunter of USAWatchdog.com as he goes One-on-One with money manager and investment expert Ed Dowd, as he talks about his new report called “Danger of Deep Worldwide Recession in 2025” for 2.8.25.

*  *  *

If you want a copy of Dowd’s new report called “Danger of Deep Worldwide Recession in 2025,” click here. There is lots of free information on Dowd’s website called PhinanceTechnologies.com. You can order Dowd’s updated book called “Cause Unknown” by clicking here. Dowd’s work on compiling data on deaths, disabilities and injuries caused by the CV19 bioweapon/vax is all free at his website called HumanityProjects.info.  You can see the data by clicking here, and you can donate to the HumanityProjects.info by clicking here.