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Breaking

25% on Canada (10% energy), 25% on Mexico, 10% on China

Trump Imposes Sweeping Tariffs on US Trading Partners [Bloomberg]

No surprise but will be shocking as it comes into effect this week.

Trudeau will be on the air tonight but literally no-one is expecting Canada to put up any resistance. In fact Tiff Macklem, the Governor of the Bank of Canada, gave the game away on Wednesday when he (they) cut rates, ended quantitative tightening and announced more buying of bonds for the BoC balance, starting in March and in line with the growth of the economy. You can see it at 0.50 on the Bank of Canada Monetary Policy Meeting Press Release [YouTube - Boc]

Apart from the dismally disingenuousness (if that's a word) of his statement, it's plain the disrespect he holds for all Canadians. At least call it Quantitative Easing because that's what it is.

Indicators Released Friday

Former Federal Reserve adviser arrested for passing trade secrets to China, Justice Department says [Reuters] 

White House says Trump to impose Canada, Mexico, China tariffs on Saturday [Reuters]

Gold

The talk of the week was the removal of physical Gold from the Bank of England's vaults to COMEX prior to tariffs on Canada and Mexico. It didn't go very smoothly and caught the BoE and bullion banks off guard. Awaking from a 50 year slumber perhaps.

On the back of this Gold broke to an all time high.

Gold / USD Monthly

Something Extraordinary Is Taking Place In The Gold Vaults Below Manhattan [Zerohedge]

Why there's now 'incredible demand for physical gold' in New York markets [Morningstar] 

United States

With other economies weaker than the US, all depends on what happens to the USD, and how Scott Bessent turns around the debt problem. The conclusion is likely to drive markets for the rest of Trump's term.

A strong USD or a weak one? 

Controllable UST refinancing or not?

2 wrecking balls concurrently!

DXY Monthly

US 10 Year Government Bond Yield Monthly

Canada

Loonie approaching a treble top.

But what to do? 25% tariffs confirmed by Trump.

Canada's illustrious leader is in Poland spending taxpayer's money while the country faces it's biggest ever challenge.

USD / CAD Monthly

Canada warns Donald Trump’s tariffs could leave US reliant on Venezuela’s oil [FT]

China

Chinese new year all of last week kept markets quiet but the Yuan is in the process of devaluing and tariffs are a great way of doing that (it's the other side's fault).

USD / Offshore Yuan Monthly

Bitcoin (& Crypto)

In the short term BTC may be susceptible to a dip lower as it's the only liquid market open over the weekend. The 2 attempts at getting over 106,000 have failed. Only a third failure would lead to a bigger move below 90,000 towards 75,000.

BTC / USD Daily

Japan

Slightly higher inflation and industrial production were the highlights this week and under the cover of Trump, the rate hike was finally executed. 

At USD 155.00 the YEN is sidelined for the moment.

The real headwind for Japan is the ageing and decreasing population. It's a global (mostly) concept but really difficult to turn around.

Europe

The last 2 days has been as bad as it can be for Germany / EU economically. Stagnant growth with disinflation.

The Euro is in a 15 year secular decline with 0.9500 target and. 0.7500 a possibility.

And yet we do see a ray of hope. The unelected reps in the EU are now talking efficiency and light regulation, following Trump.

Unfortunately any significant change would see these very reps out of a job for those very reasons, so progress is unlikely but they'll talk a good book.

EUR / USD Monthly

A Dose of DOGE (Sans Elon) Is Just What Europe Needs [Bloomberg]

CRE / Banks / CLOs

Rinse and repeat

United Kingdom

Very little economic news this week but Nigel Farage is really pushing Starmer now.

The UK is not in any way in the same position as Australia and the EU (see below). 

Plenty of innovation and light regulation but held back by a self-seeking and cowardly government.

This is the country that built the world's biggest ever empire a hundred years ago. It just needs the right leadership.

Reform’s polling surge: a familiar story or political earthquake? [FT]

Cable monthly chart shows the same characteristics as EUR / USD and AUD / USD but more bullish. The Liz Truss and her lettuce episode removed a lot of the bad news early. We are cautiously optimistic UK and cable (not Gilts) as a snap back from the brink could be huge.

GDP / USD Monthly

Australia

Good news inflation-wise in Australia this week but will the RBA do the right thing on 18th Feb. Sounds unlikely with their track record for being reactive and having no strategy. 

Like the EURO the Aussie is in a secular decline since the GFC.

The same forces apply in Australia to the EU. Ineffiective and disinterested government, high levels of red tape and heavy regulation.

The next wave of financial innovation is just about to happen and the EU and Australia look likely to be spectators.

AUD / USD Monthly

What's Next ?

Tariffs, tariffs and more tariffs. 

Also Old Lady and Nonfarm Payroll.

Watch for black swans as the Trump administration reveals just how corrupt Biden and his cronies really were.

This Week's Important Economic Indicators [London time]