Εβδομαδιαία Επισκόπηση: Διεθνής Οικονομία & Αγορές, 03/02/26
Warsh nomination as the next Fed Chair and profit taking, skim some froth from commodity prices
Precious metals have posted extraordinary volatility. Another acute rally was followed by intense profit-taking in recent sessions, with speculative forces likely at play.
In the event, gold prices reached a fresh record high of $5595/ounce during Thursday January 29th, reverting to $4403/ounce during Monday February 2nd before closing the day at $4666/ounce (+8% YtD). In a similar note, prices of silver briefly stood at a fresh record high of $122/ounce on Thursday, reverting to $71/ounce during February 2nd before ending at $80/ounce (+11% YtD).
Gold prices had almost tripled since a trough in February 2024 prior to the latest fall, albeit also due to more fundamental factors including inter alia, elevated purchases from central banks for reserve building, a weaker US Dollar (by c. -10% in the same period) and pockets of “safe haven” demand.
Oil prices have also been volatile, with gains of c. +7% wow to 6-month highs (Brent: $71/barrel) on the back, inter alia, of renewed threats from the US towards Iran regarding a possible military strike. On Monday February 2nd though, oil prices shed c. -5%, as signs of a toning-down of respective rhetoric from the US emerged during the weekend, albeit the military build-up in the region continues.
The volatility in international commodity markets fed through only modestly in major equity markets (MSCI ACWI: -0.6% on Friday and +0.6% wow) and core government bonds (US Treasury 10-year yield: roughly stable at 4.24%). Regarding equities, investors’ attention has also turned towards corporate results for Q4:2025, which largely continue on a positive note.
A renewed depreciation of the USD on US policy unpredictability also played some role in the aforementioned commodity prices movements, with losses accumulating to c. -1.5% week-to-date up to Thursday in trade-weighted terms (DXY index). On Friday though, the US dollar recovered (+0.7%) after the US President announced Mr. Warsh, a former Governor of the Federal Reserve Board, 2006 – 2011, to succeed Mr. Powell as Chair of the Federal Reserve, after the latter’s term ends in May 2026. Mr. Warsh’s nomination reassured investors.
The Fed stood pat on January 28th, as expected, with the Federal Funds Rate (FFR) at the range of 3.50% - 3.75%, albeit two members of the Committee out of twelve dissented, voting in favor of a -0.25% cut. Chair Powell suggested that the risks surrounding the Fed’s dual mandate for maximum employment and price stability (as proxied by a 2% inflation target) have come into better balance.
That development corroborated the view that the next FFR cut is not imminent. FFR futures continue to price in two cuts to a range of 3.00% - 3.25% by end-2026, both likely to come from June onwards.
Meanwhile, the US federal government re-entered a partial shutdown status as of February 1st, albeit the Congress appears to be nearing a respective funding bill, for operations to fully resume.
Looking forward, the ECB as well as the Bank of England are expected to stand pat in the current week (reference rates of 2.00% & 3.75%, respectively). Recall that euro area headline CPI inflation is estimated to have eased in January further to +1.7% yoy (due on February 4th), in a big part though, due to negative base effects for energy prices, with underlying price pressures likely remaining roughly in line with the medium-term target of 2%.
Precious metals have posted extraordinary volatility. Another acute rally was followed by intense profit-taking in recent sessions, with speculative forces likely at play.
In the event, gold prices reached a fresh record high of $5595/ounce during Thursday January 29th, reverting to $4403/ounce during Monday February 2nd before closing the day at $4666/ounce (+8% YtD). In a similar note, prices of silver briefly stood at a fresh record high of $122/ounce on Thursday, reverting to $71/ounce during February 2nd before ending at $80/ounce (+11% YtD).
Gold prices had almost tripled since a trough in February 2024 prior to the latest fall, albeit also due to more fundamental factors including inter alia, elevated purchases from central banks for reserve building, a weaker US Dollar (by c. -10% in the same period) and pockets of “safe haven” demand.
Oil prices have also been volatile, with gains of c. +7% wow to 6-month highs (Brent: $71/barrel) on the back, inter alia, of renewed threats from the US towards Iran regarding a possible military strike. On Monday February 2nd though, oil prices shed c. -5%, as signs of a toning-down of respective rhetoric from the US emerged during the weekend, albeit the military build-up in the region continues.
The volatility in international commodity markets fed through only modestly in major equity markets (MSCI ACWI: -0.6% on Friday and +0.6% wow) and core government bonds (US Treasury 10-year yield: roughly stable at 4.24%). Regarding equities, investors’ attention has also turned towards corporate results for Q4:2025, which largely continue on a positive note.
A renewed depreciation of the USD on US policy unpredictability also played some role in the aforementioned commodity prices movements, with losses accumulating to c. -1.5% week-to-date up to Thursday in trade-weighted terms (DXY index). On Friday though, the US dollar recovered (+0.7%) after the US President announced Mr. Warsh, a former Governor of the Federal Reserve Board, 2006 – 2011, to succeed Mr. Powell as Chair of the Federal Reserve, after the latter’s term ends in May 2026. Mr. Warsh’s nomination reassured investors.
The Fed stood pat on January 28th, as expected, with the Federal Funds Rate (FFR) at the range of 3.50% - 3.75%, albeit two members of the Committee out of twelve dissented, voting in favor of a -0.25% cut. Chair Powell suggested that the risks surrounding the Fed’s dual mandate for maximum employment and price stability (as proxied by a 2% inflation target) have come into better balance.
That development corroborated the view that the next FFR cut is not imminent. FFR futures continue to price in two cuts to a range of 3.00% - 3.25% by end-2026, both likely to come from June onwards.
Meanwhile, the US federal government re-entered a partial shutdown status as of February 1st, albeit the Congress appears to be nearing a respective funding bill, for operations to fully resume.
Looking forward, the ECB as well as the Bank of England are expected to stand pat in the current week (reference rates of 2.00% & 3.75%, respectively). Recall that euro area headline CPI inflation is estimated to have eased in January further to +1.7% yoy (due on February 4th), in a big part though, due to negative base effects for energy prices, with underlying price pressures likely remaining roughly in line with the medium-term target of 2%.