The financial markets are witnessing a dynamic shift as the Federal Reserve signals its need for evidence of economic weakness and subdued inflation to justify any further policy loosening. Early Friday, gold prices showed resilience, preparing for another upward trajectory. Market participants are closely observing U.S. President Donald Trump's trade policies, with particular interest in his stance against tariffs on China, which he expressed reluctance about implementing.
Meanwhile, Japan's financial landscape is undergoing significant changes. The Bank of Japan's anticipated interest rate hike to 0.50% in January has pushed the USD/JPY back below 156.00. This move aligns with the BoJ's indications of further rate hikes, providing support to the Japanese Yen. In contrast, AUD/USD has managed to maintain its strength above 0.6300 during Friday’s Asian trading session.
President Trump’s economic strategies also play a crucial role in shaping market sentiment. His low tax and light-touch regulation policies are expected to foster growth, potentially impacting various sectors positively. Additionally, his executive order establishing a Presidential Working Group on digital assets will explore the feasibility of creating a national digital asset stockpile, illustrating a forward-thinking approach to financial innovation.
The S&P Global preliminary U.S. business PMI data is eagerly awaited by investors, as it holds the potential to influence market directions significantly. The focus remains on these top-tier PMI figures as stakeholders assess the economic climate and contemplate future investment decisions.
In the cryptocurrency realm, Bitcoin traded near $103,000 on Thursday, maintaining its position within the volatile digital asset market. The Presidential Working Group on digital assets may further influence this space as it evaluates potential developments and regulatory frameworks.