Can't we get a day without news coming out of the White House? Yesterday, US Treasury Secretary Scott Bessent called for an "exhaustive internal review" of the Fed's "non-monetary policy operations." He accused the central bank of "significant mission creep." He did so on CNBC in the morning. In a lengthy post on X, Bessent sought to clarify his remarks later that day. This morning, Bessent appeared on Fox Business and reiterated his stance on the Fed. Nevertheless, he said it is okay if Fed Chair Jerome Powell stays until the end of his term.
Stocks have not moved significantly so far this week in response to this news. However, the DXY dollar index edged lower, and the gold price rose closer to its June 13 record high of $ 3,452.80 (chart). The latter jumped more than $50 yesterday in response to Bessent's attack on the Fed.
This evening, the price of gold is down slightly on news that the US has reached a trade deal with Japan. The US will impose a 15% tariff on Japan's exports to the US, with auto duties reportedly being lowered to the same level. Japan’s markets jumped after the deal announcement, with major auto stocks soaring, some over 10%, while the broader Nikkei 225 gained more than 2% (chart).
