MONEY MASTER

Federal Reserve’s Tom Barkin warned that inflation remains too high despite early signs of easing. While falling oil prices are helping, persistent pressures from services, consumer spending, and AI-driven investment mean the path back to 2% inflation is still uncertain. Inflation may be slowing but it is not yet under control. What’s Happening Inflation still elevated PCE at  4.1% YoY  (highest since April 2023) Well above Fed’s 2% target Some signs of relief emerging Oil and gasoline prices falling after ceasefire Tariff and energy pressures starting to ease But underlying inflation remains sticky Services inflation still high Strong consumer spending continues New drivers of inflation AI infrastructure buildout adding demand pressure Businesses still factoring in current inflation when pricing What’s Really Changing The inflation story is evolving: Before →  Energy and war-driven inflation spike Now →  Broad-based and structural inflation pressures Even as oil pri...

Gold steadied near the $4,000 level after softer US inflation data reduced expectations of aggressive rate hikes. While the metal has pulled back from its recent highs, easing yields and a weaker dollar are helping to stabilise prices. Gold is no longer driven by fear alone, it is now highly sensitive to interest-rate expectations. What’s Happening Inflation came in softer than expected PCE rose 0.4% → below expectations Reduces urgency for rate hikes Rate-hike expectations easing Lower probability of near-term hikes Bond yields declined Dollar momentum slowing Recent rally paused Supports gold prices Gold stabilising near $4,000 After recent sharp pullback Still heading for a fourth weekly loss What Changed Gold’s recent weakness reflects a shift: Earlier rally driven by  geopolitics + debt concerns Now pressured by  “higher-for-longer” rate expectations The market is transitioning from: Fear-driven buying → Rate-driven pricing KeyTakeaway The key driver for gold is no longer...

Gold prices plunged sharply,  erasing all year-to-date gains , as escalating Middle East tensions triggered a surge in  inflation expectations and interest rate risks , prompting aggressive selling across precious metals. Gold Sees Fastest Selloff in Decades Gold extended its losses for a  ninth consecutive session , falling as much as  8.8% to near US$4,100 per ounce , before stabilising around  US$4,225 . This dramatic decline follows what was already the  worst weekly drop since 1983 , highlighting the intensity of the current selloff. Inflation Shock Drives Rate-Hike Expectations The key driver behind the decline is a sharp shift in macro expectations: Oil prices remain elevated , fuelling inflation concerns Markets are increasingly pricing in  higher-for-longer interest rates Central banks may  delay or reverse easing cycles Higher interest rates reduce the attractiveness of gold, as it  does not generate yield , pushing investors toward...

US equities extended their decline, with the  S&P 500 falling to a six-month low , as escalating Middle East tensions heightened  inflation fears and interest rate uncertainty . Broad Selloff as War Enters Fourth Week Markets weakened sharply as the  US-Israel-Iran conflict showed no signs of easing , raising concerns of a prolonged geopolitical shock. S&P 500 Index  fell  1.51%  to 6,506 Nasdaq C omposite Index  dropped  2.01% Dow Jones Industrial Average  declined  0.96% The  Russell 2000  also slid  2.26% , now down about  10% from recent highs , signalling broader market weakness. Since the conflict began in late February, major indices have fallen  4%–7% , reflecting deteriorating sentiment. Inflation Concerns Drive Rate Expectations Higher Rising oil prices continue to push  inflation expectations upward , prompting markets to reassess monetary policy. Futures markets now suggest the  Fede...

The Japanese yen stabilised after the  Bank of Japan (BOJ) kept interest rates unchanged , as markets balanced domestic policy signals against a  hawkish US Federal Reserve outlook  and rising global energy prices. Yen Steady Despite Policy Hold The yen strengthened slightly to around  ¥159.64 per US dollar , holding onto gains following the BOJ’s widely expected decision to  maintain its benchmark rate . However, currency movements remain volatile as investors weigh: Japan’s gradual policy normalisation path Continued strength in the  US dollar driven by higher US rates Oil Prices Add Pressure on Japan’s Inflation Japan faces increasing challenges from  surging oil prices , driven by escalating conflict in the Middle East. As a major  energy importer , higher crude prices are expected to: Lift inflation pressures Increase  import costs Complicate the BOJ’s policy decisions BOJ Still Seen on Path to Rate Hikes Despite holding rates, the BOJ i...

Gold prices edged lower on Wednesday as investors adopted a  wait-and-see approach ahead of the US Federal Reserve’s policy decision , while ongoing tensions in the Middle East continued to shape the broader inflation outlook. Gold Under Pressure Ahead of Fed Guidance Spot gold declined  0.4% to US$4,984 per ounce , slipping below the key  US$5,000 level , while US gold futures showed a similar drop. The near-term direction for gold is increasingly tied to  Fed forward guidance , particularly whether policymakers signal: Potential rate cuts later this year , or A shift toward  prolonged higher interest rates Higher interest rates typically  weigh on gold , as they increase the appeal of yield-bearing assets. Geopolitical Risks Provide Underlying Support Despite the pullback, gold continues to draw support from  elevated geopolitical risks , particularly the escalating conflict involving Iran, Israel, and the US. The  Strait of Hormuz remains large...

Emerging Asian equities advanced on Wednesday, led by strong gains in  South Korea and Taiwan’s technology sectors , as easing oil prices and optimism around artificial intelligence (AI) helped improve investor sentiment ahead of the  US Federal Reserve’s policy decision . Tech Stocks Drive Regional Gains Markets in  South Korea surged up to 4% , reaching their highest level since early March, while  Taiwan equities rose 1.7% , hitting a two-week high. The rally in these tech-heavy markets lifted the  MSCI Emerging Asia Index by 1.6% , as investors rotated back into  AI and semiconductor stocks , where earnings visibility remains strong. According to BNP Paribas Asset Management,  AI-driven demand and semiconductor strength  continue to underpin the region’s equity outlook despite broader uncertainties. ASEAN Markets Follow Higher The positive momentum extended across Southeast Asia: Singapore, Malaysia, and Thailand markets rose around 1% The...

Asian equities advanced on Wednesday as investors showed  cautious optimism ahead of the Federal Reserve’s policy decision , while easing oil prices provided some relief to inflation concerns. Equities Gain Despite Geopolitical Tensions The  MSCI Asia Pacific Index rose 1.3% , marking its  third consecutive day of gains , with most sectors trading higher. This followed modest strength on Wall Street, where the  S&P 500 gained 0.3%  and the  Nasdaq 100 rose 0.5% , suggesting that investors are beginning to  look past near-term geopolitical risks . Japan’s  Topix climbed 1.3% , while broader regional markets remained steady to positive. Oil Retreat Signals Easing Inflation Pressure Oil prices edged lower, offering a temporary reprieve from inflation fears. Brent crude fell around 1% to below US$103 per barrel , while  WTI declined 1.5% , even as tensions in the Middle East intensified. The earlier disruption in the  Strait of Hormuz ...

Quick Summary US stock futures moved higher while  gold rebounded sharply  after recent losses. A  partial US government shutdown has delayed the  January jobs report , adding uncertainty to near-term data. Meanwhile, a  US–India trade deal ,  major AI investments , and  strong earnings from Palantir  shaped early market sentiment. Key Takeaways January US jobs report delayed  due to partial government shutdown US to cut India tariffs from 25% to 18%  under a  US$500bn+ trade deal Gold rebounds over 5%  after a two-day rout SpaceX acquires xAI , forming a vertically integrated AI ecosystem Big Tech ramps up AI spending ; earnings season remains in focus Markets Before the Bell Nasdaq 100 futures  +0.41% S&P 500 futures  +0.11% Dow futures  -0.11% Gold +5.43% , rebounding strongly Apple  +4.06% , Tesla  -2.00% Macro & Policy US–India trade deal : Tariffs on Indian goods cut to  18% from 25% ...

Quick Take US markets opened firmer as  Big Tech accelerates AI spending , precious metals hit fresh records, and investors digest a  Fed pause signal  from Chair Jerome Powell. Key Market Drivers Federal Reserve held rates steady  at  3.5%–3.75% , with Powell signalling  no urgency for further rate cuts Big Tech exploring up to US$60B investment in OpenAI , implying a  US$730B valuation Gold and silver hit new all-time highs  amid safe-haven demand Tesla and Microsoft beat earnings expectations , reinforcing AI-led growth themes Before the Bell: Futures Snapshot E-mini Nasdaq 100:  +0.19% E-mini S&P 500:  +0.19% E-mini Dow:  +0.06% Safe-haven assets continued to rally: Gold (XAU/USD): +2.29% Silver (XAG/USD): new record highs Fed Update: Rates on Hold The  Federal Reserve  kept policy unchanged. Chair  Jerome Powell  said monetary policy is  near neutral , suggesting a  pause in rate cuts  as ...

Gold prices surged to an all-time high above US$5,200 an ounce , driven by a sharp drop in the US dollar, rising geopolitical tensions, and growing bets on a more dovish Federal Reserve. Quick Summary Gold hits record above US$5,200  on safe-haven demand Trump dismisses dollar weakness , pressuring FX markets Bets on a dovish Fed  support bullion prices Silver outperforms , up over 50% this year What’s Driving the Gold Rally US dollar weakness  after President  Donald Trump  said he was unconcerned about the currency’s decline Flight from sovereign bonds and currencies , including US Treasuries and Japanese government bonds Geopolitical risks  and renewed concerns over  Fed independence Rising expectations of lower interest rates , which benefit non-yielding assets like gold Gold has now  gained about 20% year-to-date , breaking above  US$5,000 for the first time this week , while  silver has surged more than 50%  over the same peri...

Gold prices rose on Friday, extending their monthly winning streak as  bargain hunters  stepped in and the  US Federal Reserve’s rate cut  boosted demand for non-yielding assets, even as a stronger dollar capped gains. Market Snapshot Spot gold:  US$4,034/oz (+0.3%) US gold futures (Dec):  US$3,955/oz (–1.1%) Monthly gain:  +4.5% (third straight) The rally puts gold on track for its  best three-month stretch this year , supported by lower yields and sustained safe-haven demand amid geopolitical and trade uncertainties. Fed Policy and Rate Outlook The Fed cut its  benchmark rate by 25 basis points  this week to a range of  3.75%–4.00% , marking its  second cut of 2025 . While the move supported bullion,  Fed Chair Jerome Powell’s cautious remarks  tempered expectations of another reduction in December. According to the  CME FedWatch Tool , traders now see a  74.8% chance  of a further 25 bps cut in Decem...

Federal Reserve Chair  Jerome Powell  surprised markets this week by suggesting that another rate cut in December is  “far from a done deal.”  His remarks — following the Fed’s  25 basis-point reduction  — signal growing doubts within the central bank about whether more easing would help the U.S. economy at all. Powell’s Message: Rate Cuts Aren’t a Cure-All During his post-meeting press conference, Powell outlined several reasons for a potential pause: Divergent views  among policymakers Limited data visibility  due to the ongoing government shutdown Persistent above-target inflation Uncertainty  about how quickly the labor market is cooling Perhaps most striking, however, was Powell’s admission that  rate cuts may no longer be the right tool  to support the economy. The labor market’s recent weakness, he explained, stems  more from shrinking labor supply  — tighter immigration, early retirements, and declining participati...