#federal-reserve-policy

#federal-reserve-policy

Under the surface of soaring crude prices is the realization that the likelihood of Fed cuts later this year is quickly dwindling. Oil dominated the session. WTI crude has surged 33% over the past week, and Thursday added another 9.7% as Iran's new Supreme Leader Mojtaba Khamenei vowed to keep the Strait of Hormuz closed.

Persistent tensions in Eastern Europe and the Middle East sustain the demand for safe-haven assets. However, the surge in oil prices raised concerns about inflationary pressures, pushing up inflation expectations and lifting Treasury yields, which could continue to weigh on gold.

It's the folks who are entering the job market for the first time that are bearing the brunt of that, and to me, that's in a very standard, classic textbook way, exactly the type of unemployment that the Central Bank is equipped to help accommodate with looser monetary policy.

Gold pays no interest or dividends, making its appeal highly sensitive to what investors can earn elsewhere. When real yields fall, gold becomes comparatively more attractive. The 10-year Treasury yield has dropped from 4.29% in early February to 4.06% as of early March, coinciding directly with gold pushing to new highs.

MLPs compete directly with bonds for yield-seeking capital, making the Federal Reserve's rate trajectory the most important external variable for AMZA. The Fed has cut rates 75 basis points over the past year to a current target of 3.75%, and the 10-year Treasury has pulled back to 4.08% after peaking at 4.29% in early February. That decline has widened the spread between MLP distributions and risk-free alternatives, contributing to the rally across holdings.

In my view, this phase is not merely a temporary technical hesitation, but rather a deep confrontation between two opposing forces: growing expectations of monetary easing versus the resilience of U.S. economic data and rising real yields. This fragile balance places gold in a state of "strategic waiting," where any breakout or pullback will require a strong fundamental catalyst rather than short-lived speculative momentum.

Currency movements drive emerging market returns more than most investors realize. When the dollar weakens, emerging market assets denominated in local currencies become more valuable in dollar terms, and capital flows toward higher-yielding developing economies. The opposite happens when the dollar strengthens. SPEM's performance over the next year will largely hinge on whether the dollar continues its recent consolidation or resumes a strengthening trend.

USDJPY is currently trading around the 155.5 level. While this remains a relatively high price, the pair has already undergone a correction from its previous peak near 159.5. At one point, USDJPY slid back toward the 152 area before rebounding to its current level. The sharp and rapid movements seen in USDJPY recently indicate that the market is no longer reflecting only the economic divergence between the United States and Japan,

The S&P 500's performance in 2025 marked yet another blockbuster year after performing well in both 2023 and 2024. Many analysts thought that double-digit gains for a third straight year would be too unlikely, but the market ended up proving them wrong. 2026 is off to a great start for the S&P as well, though a correction is certainly overdue at this stage. But can the market prove bears wrong yet again?

The biggest driver for PCY over the next 12 months is U.S. interest rate trajectory. When the Fed cuts rates, two things benefit emerging market sovereign debt. First, U.S. Treasury yields fall, making PCY's 6.1% yield more attractive to income-focused investors. Second, rate cuts typically weaken the dollar, reducing the debt servicing burden for emerging market governments that borrow in dollars.

Sectors that showed notable job gains in December include food services and drinking places (+27,000 jobs), health care (+34,000 jobs) and social assistance (+17,000 jobs). On the other end of the spectrum, the retail trade sector lost 25,000 jobs in December. Residential building construction lost 4,200 jobs in December, although employment for residential specialty trade contractors rose by 1,100 jobs. The real estate sector also posted a small increase, adding 2,300 jobs in December.

Silver extended its rebound for a third consecutive session on Tuesday, supported by escalating geopolitical risks and persistent supply deficits. Developments in Latin America injected fresh geopolitical uncertainty into the market. Comments from President Trump also affected sentiment and could amplify safe-haven flows into precious metals. Meanwhile, tensions remain elevated across Eastern Europe and the Middle East, reinforcing silver's defensive appeal.

The reason mortgage rates are near yearly lows as we end the year is that the labor market has softened and mortgage spreads have returned to near-normal levels. Without these two variables, mortgage rates would have stayed higher for longer. My 2026 forecast is for the 10-year yield to range between 3.80% and 4.60%, and for mortgage rates to range from 5.75% to 6.75%.

The latest rally came after the U.S. launched strikes on Islamic State targets in Nigeria on Thursday, adding to other geopolitical tensions. Earlier in the week, the Trump administration continued to pile on more pressure on Venezuela by targeting additional oil tankers, squeezing a key source of revenue for the Maduro regime. Meanwhile, the Pentagon sent large numbers of special-operations aircraft, troops and gear into the Caribbean, sources told the Wall Street Journal.

These ETFs can complement your portfolio very well if you pair them up with popular lower-yield ETFs. Higher yields will become more important in the coming months as the Federal Reserve has shown more willingness to cut. The current Fed Chair Jerome Powell's term will end in May 2026. He's expected to be replaced with a Trump appointee. As such, the next Fed Chair is very likely to be even more dovish on interest rates.

HORSLEY: This latest report suggests they were. It shows that employers added only 64,000 jobs in November. And a lot of those jobs were in health care, which tends to be pretty recession-proof, while more sensitive industries like manufacturing and transportation lost jobs during the month. Overall, it seems clear the pace of hiring has slowed pretty sharply since the beginning of the year.

The bitcoin price dropped sharply today after a brief pump near $90,000, sliding to $84,544 as the price sell-off continued into its second month. Bitcoin lost 2% over the past 24 hours. It remains 5% below its seven-day high of $89,220 and hovers near the week's low of $84,596. Trading volume reached $56 billion. Bitcoin's market capitalization stands at $1.69 trillion. The circulating supply is roughly 19.96 million BTC out of a total 21 million, according to Bitcoin Magazine Pro data.

So the housing market faces some really significant challenges, and I don't know that, you know, a 25 basis point decline in the federal funds rate is going to make much of a difference for people. You know, housing supply is low. Many people have very, very low, low, low rate mortgages from the pandemic period, and they kept refinancing and caught the really low. So it's expensive to them to move. And you know, we're a ways away from that changing.