Hawkish FOMC Minutes vs Trump Pressure

Hello Traders! The global economy remains active, with several key developments shaping sentiment across asset classes on this first trading day of the week.

Australia’s January employment figures were mixed but overall resilient. Employment change came in lower than anticipated, though a positive upward revision to the prior month provided some offset. The unemployment rate held steady at 4.1%, better than the expected rise to 4.2%. This supportive outcome has bolstered the Australian Dollar (AUD), with the closely correlated New Zealand Dollar (NZD) also gaining ground.

Attention now shifts to the U.S., where initial jobless claims are due shortly, with consensus expectations around 223,000 (recent readings have hovered in the 225K–227K range, signaling a stable labor market). Any deviation could influence USD positioning and broader risk appetite.

Yesterday’s release of the latest FOMC minutes revealed a hawkish tone among Fed officials. Many emphasized the need for clearer evidence of sustained lower inflation before supporting rate cuts, with some even open to considering further tightening if price pressures persist. This stance contrasts sharply with expectations from President Donald Trump and his administration, who continue to advocate for more aggressive easing—highlighting ongoing tensions between the White House and the central bank.

Major stock indices are experiencing a mild correction today following two consecutive strong sessions. Despite the pullback, the broader bullish trend remains firmly intact, supported by underlying economic resilience and selective sector strength.

Currency markets are largely subdued, with most major pairs showing limited volatility and trading in narrow ranges. The AUD and NZD stand out as relative outperformers on the back of the Australian jobs data.

Commodities are displaying the most notable price action:

• Crude oil has surged approximately 7% over the past few days, driven by heightened geopolitical concerns. Markets are pricing in the risk of escalation in Middle East tensions, particularly involving Iran and the United States, which could threaten supply flows through critical chokepoints.
• Precious and base metals are attempting to push higher as well, with gold, silver, and copper showing upward momentum amid safe-haven demand and broader risk-off flows tied to global uncertainties.

Source: https://www.axiory.com/analytics/market-news/hawkish-fomc-minutes-vs-trump-pressure