The global financial markets are experiencing a significant downturn due to concerns over inflation risks and the policies of US President Donald Trump. The Federal Reserve's minutes from its December meeting highlighted potential inflation risks, leading to a net outflow of $582 million from Bitcoin ETFs and $159 million from ether ETFs. Meanwhile, XRP has surged 300% since November amid optimism for Trump's crypto-friendly policies, with some analysts predicting another 40% surge. Bitfinex Derivatives is relocating its services to El Salvador after obtaining a license to operate under the country's crypto-friendly framework. The global bond market is also experiencing a selloff, with yields reaching multi-year highs in the US, UK, and Eurozone due to inflation risks and concerns over Trump's tariff threats. In Asia, central banks are facing challenges as the strong US dollar devalues their currencies, raising import costs and complicating their economic strategies.
https://www.coindesk.com/daybook-us/2025/01/09/crypto-daybook-americas-turmoil-across-the-pond-as-bitcoin-defends-93-k-after-300-b-wipeoutThe US dollar rose to its highest level since April 25, reaching 4.73% on the benchmark 10-year Treasury note, after President-elect Donald Trump considered declaring a national economic emergency to implement tariffs on allies and adversaries. This move is expected to boost economic growth through deregulation and lower taxes, but may lead to increased inflation. The dollar index rose 0.28% to 109.00, with the euro falling 0.2% to $1.0318. Markets are pricing in a 39 basis point interest rate cut from the Federal Reserve this year, with a first cut likely to happen in June.
https://channelnewsasia.com/business/dollar-up-us-10-yr-yield-hits-8-12-month-high-tariff-report-4844301The potential for broad-based tariffs proposed by US President Donald Trump has investors concerned about a surge in inflation, which could limit the Federal Reserve's ability to cut interest rates. According to James Knightley, an economist at ING Economics, if enacted, the tariffs could lead to $833 billion in cost increases for US importers, with 60% of that increase being absorbed by consumers through higher prices and companies absorbing some costs via lower profit margins. This could potentially lift inflation by as much as 2.5 percentage points.
https://markets.businessinsider.com/news/currencies/us-dollar-decline-trump-tariffs-truth-social-trade-economy-inflation-2025-1European and Asian equities experienced a less favourable start to the New Year due to uncertainty over US President Trump's policies and a more hawkish Federal Reserve outlook. The STOXX 600 index initially declined but later steadied, while US stock futures rose by around 1%. European oil & gas stocks were boosted by higher crude futures after Russian gas firm Gazprom halted exports via pipelines through Ukraine due to a transit agreement dispute. China's CSI 300 Index and Shanghai Composite Index fell sharply, logging their weakest New Year start since 2016, as factory data disappointed investors. President Xi Jinping announced more proactive policies to boost growth in 2025, but investors are closely monitoring the country's recovery amidst potential headwinds from Trump's tariffs on Chinese goods.
https://www.gulftoday.ae/business/2025/01/02/world-shares-start-2025-with-wobble-on-trump-trepidationAbu Dhabi's Mubadala Investment Company has surpassed Saudi Arabia's Public Investment Fund in terms of deal value, with a total of US$29 billion worth of transactions in 2024. This achievement is attributed to the company's strategic investments in various sectors such as technology and renewable energy. In contrast, Blackstone Group LP sees significant potential for investors in Asia, particularly in private markets. The dollar has maintained its strength in 2024 due to a cautious Federal Reserve and the Trump administration's trade policies. Chery Automobile Co Ltd has partnered with JPMorgan Chase & Co for a US$1 billion listing on the Hong Kong stock exchange.
https://www.businesstimes.com.sg/companies-markets/banking-finance/abu-dhabis-mubadala-eclipses-saudi-pif-us29-billion-dealsThe Indian rupee fell to a new low in early trade on Wednesday, dropping 5 paise to 85.69 against the US dollar. The decline was attributed to the strength of the American currency in overseas markets and persistent foreign fund outflows. The rupee had closed at an all-time low of 85.64 against the US dollar on Tuesday, with experts citing the Federal Reserve's cautious stance and the "Trump factor" as contributing factors to the decline. Despite the RBI intervening to support the rupee by setting a floor price of 85.6450 on Tuesday, the currency continued to depreciate in early trade on Wednesday.
https://www.deccanchronicle.com/business/market/rupee-falls-5-paise-to-8569-against-us-dollar-in-early-trade-1851064