The Trump administration is prepared to nominate Kevin Warsh as the next Federal Reserve Chair later today. Warsh is expected to be more hawkish than other contenders for the role. Equities fell, Treasury yields pushed higher, and the dollar strengthened across the board. The question now becomes whether Warsh will go against his usual reputation as an inflation hawk and continue to align his policy direction with Trump, having recently argued publicly in support of lower borrowing costs. S&P 500 futures fell 0.7%, Nasdaq 100 futures fell 0.8%, and the MSCI Asia Pacific Index declined 0.9%.
Extreme and sudden moves were observed across the metals market. Precious metals saw a reversal of recent haven trades yesterday, with spot gold falling as much as 4.8% from recent all-time highs and currently trading at $5,151.60/oz. The London Metal Exchange suffered a one-hour delay at the start of today’s trading session, citing a technical issue. Copper fell as much as 3.9% after surging 11% yesterday — its biggest intraday gain since 2008.
On the economic calendar to wrap up the week, we have Germany’s January CPI at 1:00 PM, followed by US December CPI at 1:30 PM, along with a number of Fed speakers: Musalem (6:30 PM), Miran (8:00 PM), and Bowman (10:00 PM).
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Bitcoin fell 2.4% to $82,360.29
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Ether fell 3.6% to $2,713.18
