Bonds & Stocks
Wall Street kicked off February on a relatively cautious note, with stocks wavering amid a unwinding of the surge in precious metals to all-time highs even as losses in gold and silver moderated. Oil sank. Bond yields rose alongside the dollar. Equities struggled to gain traction after Friday’s dramatic selloff in metals, with the S&P 500 edging lower.
Economy
For much of the time that President Donald Trump was mulling his potential choice for the next chair of the Federal Reserve, the debate in markets swirled around whether his pick would lower interest rates as aggressively as he preferred. Now, with his selection of former Fed Governor Kevin Warsh — an economist known as much for his fierce criticism of the central bank as his changing views on monetary policy — the debate has abruptly shifted from short-term rates to the Fed’s $6.6 trillion balance sheet and its very role in markets.
World
The Bank of England is expected to keep interest rates on hold at 3.75% this week as policymakers weigh contradictory signs that the economy is both strengthening and losing jobs with unemployment at a near fiveyear high. The Monetary Policy Committee is treading carefully having cut rates from 5.25% since August 2024.