Trump & Elon Musk are set to inspect America’s gold reserves amidst economic volatility, a weakening USD, rising gold prices, and escalating conflict in Ukraine.
1. Economy & Finance
Euro Strengthens After German Election
The euro recorded a 0.46% increase, reaching 1.0508 USD, following the victory of Germany’s opposition conservative party in the national election. This win fuels positive market expectations, as Friedrich Merz, a proponent of tax cuts and economic reforms, is likely to become the next chancellor. Investors remain optimistic about upcoming economic policies, sustaining the euro’s growth into the new trading week.
USD Weakens Amid Interest Rate & Economic Growth Concerns
The USD continues to decline, dropping over 3% from its January peak, as concerns over U.S. economic growth and potential interest rate cuts by the Federal Reserve (Fed) increase. Falling U.S. Treasury bond yields, especially in real terms, have pressured the greenback. Additionally, several Fed officials have hinted at possible monetary policy adjustments, making investors more cautious about holding USD.
U.S. Immigration Restrictions Could Lower GDP Growth
Stricter immigration policies in the U.S. could slow GDP growth to 1%-1.5% next year, compared to the previous 2.5%-3% rate. A decline in immigrant labor could lead to workforce shortages, forcing businesses to increase wages, potentially fueling inflation. This may result in the Fed cutting interest rates only once this year, rather than multiple times as previously expected.
Fed Awaits More Inflation Data Before Policy Decision
The Fed is holding off on any immediate policy changes while waiting for further inflation data. The Personal Consumption Expenditures (PCE) Index, a key inflation measure, is expected to slightly decline but still remain above the 2% target. If inflation remains elevated, the Fed may maintain a cautious stance and delay interest rate cuts in the short term.
2. Russia-Ukraine Conflict
Ukraine Has Lost 11% of Its Territory After Three Years of War
Since 2022, Ukraine has lost approximately 11% of its land to Russia, according to a report from the Institute for the Study of War (ISW). While the conflict remains intense, there has been no significant breakthrough in peace negotiations, and Western military aid has shown signs of slowing down.
Uncertain Future of U.S. Aid to Ukraine
The U.S. has provided nearly $95 billion in aid to Ukraine, covering military, financial, and humanitarian support. However, the future of this assistance is uncertain, especially if Donald Trump returns to the presidency. Any shift in U.S. policy could significantly impact Ukraine’s defense capabilities against Russian aggression.
Ukraine’s Humanitarian Crisis Worsens
The prolonged conflict has caused a severe humanitarian crisis in Ukraine, with over 6.3 million refugees in Europe and more than 40,000 civilian casualties. This situation presents a growing challenge for both Ukraine’s government and international aid organizations.
Zelensky Offers to Resign for Peace & NATO Membership
Ukrainian President Volodymyr Zelensky has expressed his willingness to resign if it would help achieve peace and secure NATO membership for Ukraine. He emphasized that Ukraine seeks a strong partnership with the U.S. rather than just being a mediator in negotiations with Russia. Additionally, Ukraine has rejected a $500 billion debt to the U.S., stating that aid should not be considered a loan.
3. Middle East Situation
Houthis Launch Attacks on U.S. Aircraft but Cause No Damage
The Houthis launched attacks targeting U.S. fighter jets and MQ-9 Reaper drones, but no significant damage was reported. Analysts believe this could signal a shift in Houthi attack strategies, as tensions between the group and Western forces continue to escalate.
Israel & EU Discuss Gaza Reconstruction
Israel and the European Union (EU) have held their first high-level talks since 2022 to discuss humanitarian conditions in Gaza and bilateral relations. This dialogue is expected to pave the way for reconstruction efforts following a recent ceasefire, as well as promote economic and security cooperation between the two sides.
Israel Warns of Possible Military Strategy Shift in Gaza
Israeli Prime Minister Benjamin Netanyahu has warned that Israel is prepared to adjust its military strategy in Gaza if security conditions continue to deteriorate. He emphasized that Israel’s top priority is maintaining regional stability and protecting its citizens, while ensuring that its military forces are prepared for any potential scenario.
4. Politics & Society
Trump & Elon Musk to Inspect Fort Knox Gold Reserves
Former U.S. President Donald Trump announced that he and Tesla CEO Elon Musk will personally inspect the Fort Knox gold reserves, which are considered America’s largest gold holdings. This decision follows Elon Musk’s public skepticism about whether the U.S. gold reserves remain intact, sparking widespread speculation in financial circles.
5. Infrastructure & Transportation
Accelerating Construction of Gia Binh – Hanoi Airport Connection
Vietnamese Prime Minister Pham Minh Chinh has ordered the fast-tracking of the Gia Binh Airport (Bac Ninh) to Hanoi connection project, which is expected to be completed within two years. This effort aims to align with the airport’s construction timeline, improve transportation, and boost regional economic growth.
6. Financial Markets
Gold Prices Adjust After Strong Rally
Global gold prices have fallen to $2,924 per ounce, down from a record high of $2,950 per ounce. This decline is mainly due to profit-taking by investors, following a prolonged surge in gold prices amid economic uncertainties and geopolitical tensions.
