Financial Market Newsletter

The U.S Department of the Treasury has said the renminbi is “significantly undervalued” and urged China to allow its currency to appreciate in a timely and orderly manner.

The U.S Federal Reserve last night announced it would keep its benchmark interest rate for the world’s largest economy unchanged at 3,5% - 3,75%, with 10 out of 12 members voting in favour.

The USD posted its sharpest one-day decline since the tariff shock in April 2025, after President D. Trump said he was not concerned about the currency’s recent depreciation. The USD Index fell by 1,28% yesterday and is down 1,68% so far this week.

Global gold prices rose and held above USD 5.000 per ounce for a second straight session, driven by a weaker USD alongside additional support from heightened geopolitical risk and a pullback of capital from Government bonds and money markets.

Business activity across the U.S and several major economies in Europe and Asia strengthened in the first month of 2026, with early signs of a recovery in export orders as the global economy gradually adapts to higher U.S tariffs.

The Bank of Japan is expected to keep interest rates unchanged at its January policy meeting on Friday noon, maintaining its cautious view that the economy will continue to recover at a moderate pace - supporting the case for further rate hikes at some point in 2026.

U.S President Donald Trump said late Tuesday that he would not impose tariffs on goods from European countries opposing his effort to secure Greenland, citing “the framework of a future agreement” that he said had been reached with stakeholders linked to the island.

The USD posted its sharpest one-day decline in more than a month on Tuesday (-0,5%), after President D. Trump’s threats toward Europe over Greenland weighed on equity markets and U.S Treasuries, while supporting gains in the EUR and GBP.

According to data released by China’s National Bureau of Statistics on Monday, the country’s Gross domestic Product (GDP) grew by 5% in 2025.