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Gold edges past $4,600/oz as Powell-Trump rift stokes safe-haven demand
On 'Monday', gold broke through $4600/ounce, and silver hit a new record. Investors rushed to safe havens in response to increased geopolitical uncertainty, as well as a criminal investigation into Federal Reserve Chairman Jerome Powell. By 0410 GMT, spot gold had risen 1.3% to $4,668.80 an ounce. Bullion reached a record-high of $4,600.33 during the day. U.S. Gold Futures for February Delivery firmed by 1.8% to $4.579.10. "So, between events in Iran and possible U.S. participation, as well as the (Fed's) chair being at the center of a criminal investigation... U.S. Futures turned lower on Powell news which was a greenlight for?gold? to take a rise," said Tim Waterer. A rights group reported that more than 500 people have been killed in unrest in Iran. Tehran also threatened to 'target U.S. bases' if Donald Trump follows through on his threats to attack the country as a result of the protests. Iran's unrest is a result of Trump's international flexing of U.S. muscle, after he ousted Venezuelan president Nicolas Maduro and discussed acquiring Greenland via purchase or force. Powell claimed on Sunday that the Trump administration threatened to indict him for his testimony before Congress. Powell called this action a "pretext", a way of increasing pressure on the central banks to lower interest rates. The dollar and U.S. stock futures fell as a result. Investors expect two Fed rate cuts this year. In a low interest rate environment, and in times of geopolitical and economic uncertainty, non-yielding investments tend to perform well. Waterer stated that he expects the appetite of central banks for gold and other precious metals to continue to grow this year. These metals are perceived as a safer alternative to dollars. Spot'silver' was up 4.1% to $83.20 an ounce after reaching a high of $83.96 the previous day. After reaching a record-high of $2,478.50 per ounce on December 29, spot platinum rose 3.4% to $2349.59 an ounce. Palladium rose 3.4%, to $1877.96 an ounce. (Reporting by Ishaan Arora in Bengaluru; Editing by Subhranshu Sahu)
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Investors look past Italy's Real Estate Scandal
Italy's real estate market may outpace the rest of Europe in 2026, as political stability as well as a clean-up of regulatory issues following a scandal involving building permits in Milan boost investor confidence. The property research group Scenari Immobiliari predicts that transactions on the Italian real estate market this year will rise by 8.4% to 175,8 billion euros ($205.9 billion), with residential properties accounting for over 80%. According to Scenari Immobiliari, this would be "faster" than 7% growth on the Spanish property market. In comparison, UK's housing market grew by 6.6%, Germany 4.1%, and France 3.2%. The Milan building scam, which was made public in 2024, and centered on the fast-tracking permits for high-rise development, fueled industry fears of a mass exodus of investors. After the court process, more than 100 construction projects in Rome, Italy's largest real estate market were halted. Scenari Immobiliari warned Milan a year earlier that gridlock could cost the city up to 38 billion euro in lost investment potential over a 10-year period, either in real estate directly or indirectly through effects on the local economy. A?rare period in Italy of political stability under Prime Minister Giorgia Melons, who has been in power for three years now, helps attract investors. According to Scenari Immobiliari, the number of transactions in Italy's property market will increase by almost 7% between 2025 and 2026, making it Europe's second-hottest market after Spain. Davide Dalmiglio is the managing director and chief executive officer of the Italian division of British real estate company Savills. He says that the capital flight fears have not come to pass. He said that the investigations had "put investors on alert" and prompted a level pre-acquisition scrutiny, "never seen for 25 years", with much more thorough due diligence. Manfredi Catella is the chief executive officer of the property developer Coima. He argues that the judges, by setting stricter rules (although more expensive), have eliminated uncertainty regarding the interpretation of the building regulations, which he said was "the market's primary concern". Documents seen by revealed that Catella was investigated in a second round of investigations into the industry. These probes included allegations of corruption against municipal officials, developers and architects. Catella, who denied any wrongdoings, said that he was refused house arrest by two courts in the summer of last year, including Italy's Supreme Court. This, according to Coima's investors, vindicated his position. Good Metrics Beatrice Guedji is the head of research and innovations at Swiss Life Asset Managers France. She oversees the real estate investments in Italy. She said that the themes of Meloni's momentum, and the growth prospects for the country, were what drove investment. Swiss Life Asset Managers France increased its allocation to Italy in 2025 by 15%, with property investment since 2018 expected to reach 500 millions euros by early 2026. Guedji cited "good key metrics", including a narrower spread between the benchmark Italian and German bonds, an improved rating outlook and the Milan Stock Exchange outperforming other European exchanges as indicators of reduced country risk. In recent years, Milan, in particular, attracted a number of millionaires due to the flat tax that is applied to very wealthy foreigners. MILAN in the Spotlight AGAIN The economic growth is still sluggish, but the Winter Olympics in Milan, which were co-hosted in February, are bringing money into the economy. It is expected to grow 0.7% by 2026 after a 0.5% increase in 2025 according to the Bank of Italy's forecast. The impact of the Olympics on the real estate market could be temporary. Guedji noted that her firm was focused on long-term investments. The fallout of the Milan property scam continues to linger. Some investigations of alleged violations of building codes have already been tried, and others are still in the early stages. More than 4,100 families still wait to move into apartments at frozen projects they paid for. LACK OF NEW SUPPLY The market is also concerned with supply. Scenari Immobiliari predicts that investment in Italy’s real estate market will increase to?12bn euros in 2026, up from 11.5bn last year. However, it warns that medium-term supply restrictions could limit growth. The total number of residential transactions is expected to rise by 7% in 2025. However, newly constructed units will only account for 10%, a drop from the historical average of 15%. Francesca Zirnstein said that "mid-sized residential projects – the 20-30 unit building replenishing stock – have often been stalled due to tougher dialogues between Scenari Immobiliari and public administrations." She said that the market was healthy and growing but that urban regeneration had slowed down due to investigations. This would result in fewer new development in the next few years.
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Dollar tips, RPT-stocks sway as Trump-Fed fight deepens
The dollar fell and U.S. stock futures dropped after Federal Reserve chair Jerome Powell claimed that the Trump administration had?threatened? him with a criminal investigation, fueling investor concerns about the independence of the central bank. S&P 500 futures were down 0.5%. European futures fell 0.1% during the morning of Asia. The dollar dropped 0.2% against the major currencies, dropping below 158 yen to $1.1660. The news, traders said, was unsettling. However the immediate impact on interest rates is not known. Benchmark 10-year Treasury Futures rose by 3 ticks, resulting in an implied yield (4.15%), which is about one basis point less than Friday's close of the cash market. Fed fund futures added about three basis point more in cuts in this year. This is small, but indicates the risk that the Fed will be pushed to become more aggressive. Unrest in Iran boosted precious metal prices and supported oil, causing gold to reach a record-high of $4,600 per ounce. Powell claimed that the Trump administration threatened him with a criminal investigation and issued grand jury subpoenas for Congressional testimony he provided last?summer about a Fed building project. He called this action a "pretext", aimed at forcing the central bank into cutting?interest rates. These developments represent a dramatic escalation of the battle between Powell and U.S. president Donald Trump that dates back to Powell's first year as chairman in 2018. Andrew Lilley is the chief rates strategist for Barrenjoey Investment Bank, a Sydney-based investment bank. The only reason he is taking these actions is because he knows he won't be able to control the Fed. He wants to exert as much pressure?as possible. Investors will not be pleased, but this shows that Trump has no other levers at his disposal. The FOMC will keep the cash rate at what they want it to be. The dollar's sharpest reaction was a fall, even when compared to currencies that are typically risk-sensitive like Australian and New Zealand dollar. This helped the yen escape intervention-risk territory by falling below 158 dollars. Ray Attrill, head of currency strategy at National Australia Bank, said: "This open war between the Fed and U.S. government... is not good for the U.S. Dollar." Trump's threats of?intervening in Iran, where the protests against the clerical regime appear to be intensifying has helped oil prices maintain recent gains, and highlighted the swirling geopolitical risk for the coming year. Brent crude futures fell about 40 cents, to $62.90 per barrel. The broadest MSCI index of Asia-Pacific stocks outside Japan climbed 0.5%, while Japanese markets remained closed on a holiday. The second week of the new year will feature U.S. inflation figures, trade data from China, and a number of U.S. earnings starting with JPMorgan Chase on Tuesday and BNY. (Reporting and editing by Thomas Derpinghaus; Tom Westbrook)
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Goldman predicts lower oil prices by 2026, as the supply increases
Goldman Sachs stated in a Sunday note that oil prices will likely drift lower as a wave supply creates an excess on the market. However, geopolitical risk?tied to Russia Venezuela and Iran?will continue to drive volatility. The investment 'bank' maintained its forecasts for 2026 of $56/$52 a barrel for Brent/WTI and expects Brent/WTI to reach a low point at $54/50 by the end of the quarter due to OECD inventory buildup. Goldman Sachs stated that "rising global oil inventories and our forecast for a 2.3mb/d excess in 2026 suggests that rebalancing of the market will likely require?lower prices in 2026 in order to slow non-OPEC growth in supply and support solid demand 'growth. Brent crude futures are trading at $63 per barrel as of 0412 GMT. Meanwhile, U.S. West Texas intermediate crude is holding steady at $59 a barrel. Both benchmarks had their worst year since 2020 with a decline of almost 20%. Analysts at the bank note that the focus of U.S. policymakers on a strong?energy supply, and relatively low oil costs will prevent sustained oil price increases ahead of the midterms. Goldman analysts wrote in a report that prices are expected to slowly start recovering by 2027. The market will return to a deficit, as non-OPEC supplies slow down and demand continues to grow. The investment bank estimates Brent/WTI will average $58/54 by 2027. This is $5 less than their previous estimate. They cite a?upgrade to supply for 2027 in the U.S. Venezuela and Russia of 0.3, 0.40 and 0.5mb/d respectively. Goldman said it expected a significant price recovery in the second half of this decade, as demand increases through 2040, after years with low long-cycle investments. Prices for Brent/WTI will average $75/$71 between 2030-2035, which is $5 less than its previous estimate. Goldman added that despite geopolitical risk and low speculative positions, it does not expect any OPEC production reductions. Oil producers can hedge the price decline in 2026 by shorting the Brent time-spread 2026Q3 to Dec2028.
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Japan embarks on rare earth search as China tightens supply
A Japanese mining vessel left on Monday for an atoll coral to explore mud rich in rare earths. This is part of Tokyo’s efforts to reduce its dependence on China as Beijing restricts the supply. The Chikyu test vessel will be on a month-long mission near Minamitori Island, some 1,900 km (1200 miles) south of Tokyo. This is the first time in the history of mankind that a seabed sludge of rare earths can be continuously lifted from?6km (4 miles) depth onto a ship. Japan has reduced its dependency on China, as have its Western allies. These minerals are vital for the production of smartphones, military equipment and cars. This effort has become more urgent due to a major diplomatic disagreement with Beijing. After seven years of preparation we can now begin the confirmation test. Shoichi Ishii said, "It's deeply moving," as the vessel left the port city Shizuoka, on a sunny, bright day with Mount Fuji snow-capped in the background. He said that if the project is successful, it would have a great impact on diversifying Japan's procurement of rare earth resources. Recovering key minerals 6 km beneath sea level was a significant technological achievement. The vessel with 130 crew members and researchers is scheduled to return?to the port on February 14th. It won't be easy to reduce dependence on China China has banned the export of some minerals that are critical to Japan's military. The Wall Street Journal reported that Beijing has begun to restrict rare-earth exports more broadly. Japan condemned China's ban on dual-use but refused to comment about reports of a wider ban. China has neither confirmed nor denied the report. Chinese state media have reported that Beijing is weighing this measure. Sources familiar with the issue have confirmed that the finance ministers of the industrial powers in the Group?of Seven will meet on Monday to discuss the supply of rare-earth elements. Japan has faced China's anger over?rare Earths before. China halted exports in 2010 after an "incident" near disputed islands of the East China Sea. Japan's dependence on China has been reduced from 90% to 60% by investing overseas in projects such as the trading house Sojitz's tie up with Australia's Lynas Rare Earths, and promoting rare earths recycling and manufacturing methods that depend less on minerals. However, the Minamitori Island Project is the first attempt to source rare Earths domestically. Takahide Kiuchi is the executive economist of Nomura Research Institute. He said that if the new export controls end up covering many rare earths, Japanese firms will once again try to get away from China. But I don't believe it will be an easy task. Analysts say that Japan's automotive industry is at risk because it is so dependent on China for?heavy rare earths such as magnets used in electric and hybrid vehicle motors. LONG-TERM PROJECT The Japanese government and private firms have been stockpiling the minerals since the 2010 scare. However, they don't disclose the volume. Several executives at a New Year’s party held for the mining industry in Japan on Wednesday said that they were more prepared than ever to deal with any disruptions. They cited Japan's stockpiles and diversification efforts. Kazumi Nishikawa is the principal director of economic security in the Trade Ministry. He said that the government must constantly remind businesses to diversify their supply chain. "Sometimes you know, an event happens, and then the business reacts. But the event ends, and the business forgets." Nishikawa said on this week's China Talk podcast that we must maintain our efforts. The government's Minamitori Island Project, which has cost 250 million dollars in 40 billion yen since 2018, is a long-term investment. No production goal has been established and the estimated reserves of the mine have not been revealed. If the trial is successful, full-scale mining will begin in February 2027. The high cost of mining mud made it uneconomical. If the supply disruption from China continues and more buyers are willing to pay higher price, then this project may become viable within the next few years, according to Kotaro Shiimizu, principal consultant at Mitsubishi UFJ Research and Consulting. China keeps a close eye on the situation. Ishii stated that a fleet Chinese naval ships were nearby when the ship conducted surveys around the island last June. He said: "We are deeply disturbed by the intimidatory actions taken." China claimed that its actions were compliant with international law, and called upon Japan to "refrain" from making threats. (Reporting from Yuka Obayashi, Shizuoka. Katya Golubkova in Tokyo. Writing by John Geddie. Editing by William Mallard.)
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Silver, gold reach record highs amid Fed rate cut bets and safe-haven demand
Gold prices broke the $4,600-per-ounce barrier on Monday, for the first time. Silver also reached a new record high. This was boosted by geopolitical, economic, and betting trends that the U.S. will cut interest rates. By 0203 GMT, spot gold had risen 1.3% per ounce to $4469.49. Bullion reached a record-high of $4,600.33 during the day. U.S. Gold Futures for February Delivery firmed by 2% to $4.591.10. Kelvin Wong is a senior analyst at OANDA. He said that the geopolitical risks are driving the bullish intraday momentum in the gold and silver market today. A rights group reported that more than 500 people have been killed in the unrest in Iran, while Tehran warned to target the U.S. If President Donald Trump follows through on his threats to strike the country in support of protesters, military bases will be affected. Iran's unrest is a result of Trump flexing his muscles abroad, after he ousted Venezuelan president Nicolas Maduro and discussed acquiring Greenland through purchase or force. Data released on Friday showed that the U.S. job growth was slower than expected in December. This is due to job losses in construction, retail, and manufacturing. A decline in unemployment rates suggests that the labour market is not rapidly degrading. Investors expect that the Federal Reserve will cut rates at least twice this year. Rate cuts are more likely with a softer job market. Fed Chair Jerome Powell stated on Sunday that the Trump administration threatened him with a criminal indictment for Congressional testimony. Powell called this action a "pretext", aimed at putting more pressure on the central banks to 'lower rates. The dollar has retreated to its lowest level in over a month, which also supported the rise in precious metals. Non-yielding investments tend to perform well in low-interest rate environments and when there are geopolitical or economic uncertainties. Spot silver rose 3.5% to $82.72 an ounce after reaching a record high of $83.96 per ounce earlier in the day. After reaching a record high of $2,478.50 per ounce on December 29, spot platinum increased by 3.2%, to $2,345.40. Palladium rose 3.3%, to $1.875.68 an ounce. (Reporting by Ishaan Arora in Bengaluru; Editing by Subhranshu Sahu)
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China to boost consumer demand with new policy measures
Prices of copper rose on Monday as the dollar fell and expectations of better demand grew. China, the world's largest copper buyer, plans to introduce a package?of policies designed to boost domestic consumer demand. By 0151 GMT, the most traded?copper contracts?on Shanghai Futures Exchange had risen 2.91%, to 103200 yuan (US$14,792.94) a metric ton. On January 6, it reached a record-high of 105,500 Yuan. Benchmark three-month Copper on the London Metal Exchange rose 1.22% to $13,156 a ton. The benchmark reached its highest level at $13,387.5 per ton on January 6 China's cabinet met on Friday under the leadership of Premier Li Qiang to discuss a number of financial and fiscal policies that will boost domestic demand. These include initiatives to encourage household consumption. The fall in production by Chilean state-run copper miner Codelco, in November, also helped to support the prices of copper. Copper is used in power, construction, and manufacturing. The market also focused on Rio Tinto’s talks to acquire Glencore. If the deal is successful, it could make the world’s largest mining company, with a combined market worth of approximately $207 billion. Base metals were supported by a weaker U.S. dollar, which made commodities priced in dollars less expensive for buyers who used other currencies. SHFE nickel surged by?3.63%, to 142 060 yuan. Two analysts, who spoke on condition of anonymity because they were not authorized to speak with the media, stated that Shanghai tin has hit its highest level since Mach 9, 2020 at 371,870 Yuan per?ton due to concerns about supply. SHFE Aluminium gained?1.93%. Lead advanced 1.65%. Zinc added 0.48%. ($1 = 6.9763 Chinese yuan) (Reporting by Amy Lv and Lewis Jackson; Editing by Subhranshu Sahu) $1 = 6.9763 Chinese Yuan (Reporting and editing by Amy Lv, Lewis Jackson)
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Oil steady, investors weigh Venezuela export resumption versus potential Iran supply disruption
Prices were not much changed Monday, as investors watched for potential disruptions in supply from OPEC member Iran. However, efforts to resume Venezuelan oil exports quickly kept prices under control. Brent crude futures fell 5 cents, to $63.29 per barrel at 0131 GMT. U.S. West Texas intermediate crude dropped 6 cents, to $59.06 per barrel. Both contracts rose more than 3% in the last week, clinching their largest weekly increase since October. This was due to Iran's clerical regime stepping up its crackdown against the largest demonstrations since 2012. Saul Kavonic is the head of MST Marquee's energy research. He says that while oil prices have increased in recent days, the market still underestimates the geopolitical risks from a wider conflict with Iran, which could impact oil shipments through the Strait of Hormuz. He added, "The market says show me disruptions in supply before I respond materially." A rights group reported on Sunday that the civil unrest has resulted in more than 500 deaths. In a note, ANZ analysts headed by Daniel Hynes stated that there have been calls to stop working in the oil sector amid the protests. The report added that "the situation places at least 1.9 millions barrels per day of oil exports in danger of disruption." Donald Trump, the U.S. president, has repeatedly warned that he will intervene if violence is used against protesters. A U.S. official said on Sunday that the?president will meet with senior advisers to discuss options regarding Iran on Tuesday. Venezuela will resume oil exports as soon as possible after the ouster President Nicolas Maduro. Trump said last week that the Caracas government is ready to deliver 'as much as fifty million barrels' of sanctioned crude oil to the United States. Four sources familiar with these operations say that this has sparked a race between 'oil companies' to find tankers, and to assemble the necessary operations to safely ship crude oil from the vessels and the dilapidated Venezuelan port. Trafigura told the White House in a Friday meeting that the first vessel would be loaded in the coming week.
Dollar tips, stocks wobble as Trump-Fed fight deepens
Dollar fell and U.S. equities?futures dropped after Federal Reserve chair Jerome Powell claimed that the Trump administration had threatened him with an?indictment. This stoked investor concerns about the independence of the central bank.
S&P futures fell 0.5% while?European Futures dropped 0.1% during the morning of Asia and the dollar fell roughly 0.2% against major counterparts, sending it to below 158 yen, and $1.1660 for the euro.
The news is unsettling for traders, but the immediate impact on interest rates is not known.
Benchmark 10-year Treasury Futures rose by 3 ticks, resulting in an implied yield of 4.15 percent. This is approximately a basis-point below the close on Friday for the cash market. Fed fund futures have cut by about three basis point this year. This is small, but indicates that the Fed could be pushed to become more aggressive.
Unrest in Iran boosted precious metals prices and supported oil.
Powell claimed that the Trump administration threatened him with a criminal prosecution and issued grand jury subpoenas for Congressional testimony he provided last summer about a Fed 'building renovation project. He called this action a 'pretext' to pressure the central bank into cutting interest rates.
These developments represent a dramatic increase in the 'fight between Powell and U.S. president Donald Trump that dates back to Powell's first year as chairman in 2018.
Andrew Lilley is the chief rates strategist of Barrenjoey Investment Bank, a Sydney-based investment bank.
The only reason he is taking these actions is because he knows he won't be able to control the Fed. He wants to exert all of the undue pressure he can.
Investors will not be pleased, but this shows that Trump does not have any other levers at his disposal. The majority of FOMC members want the cash rate to remain at that level.
The dollar's reaction was the most dramatic, even when compared to currencies that are typically more risk-averse like Australian and New Zealand dollar. This helped the yen escape from intervention-risk terrain on the lower side of 158 dollars.
Ray Attrill, head of currency strategies at National Australia Bank, said: "This open war between the Fed and U.S. Administration... is not good for the U.S. Dollar."
Trump's threats of intervening?in Iran where protests appear to be intensifying against the clerical regime, have helped oil prices maintain recent gains, and highlighted the swirling geopolitical risk for the coming year.
Brent crude futures, the benchmark for oil prices, were down 40 cents at $62.90 per barrel after recent sharp gains.
The broadest MSCI index of Asia-Pacific stocks outside Japan climbed 0.5%, while Japanese markets closed for the holiday.
The second week of the new year will feature U.S. inflation figures, trade data from China, and a number of U.S. earnings starting with JPMorgan Chase on Tuesday and BNY. (Reporting and editing by Thomas Derpinghaus; Tom Westbrook)
(source: Reuters)