US: District Judge Blocks Trump's Federal Spending Freeze
A US District Judge blocked a Trump administration freeze on federal spending, ordered by the White House Office of Management and Budget, minutes before it was set to go into effect yesterday. The block will expire Feb 3 at 17:00 ET 22:00 GMT.
- The order, which covers all government spending except direct payments to individuals, such as Social Security, and Medicare, is widely seen as the most far-reaching of Trump’s executive actions and part of a broader attempt to recalibrate potentially trillions of dollars of federal government spending. The coming week will test to what extent Trump can realise the bulk of his agenda via executive action.
- White House Press Secretary Karoline Leavitt told reporters, “[if government agencies] feel that programs are necessary and in line with the president's agenda, then [OMB] will review those policies.”
- In response, Senate Democrats accused the Trump administration of “wanting to seize control of everything,” (Senator Tammy Duckworth (D-IL) and to “cut, cut, cut, cut – to give one thing: tax breaks to the very wealthy,” (Senate Minority Leader Chuck Schumer (D-NY).
- The Democrat counteroffensive is likely to include a concerted effort to hold up Trump’s Cabinet nominees, particularly OMB Director Russell Vought – a central figure in ‘Project 2025' – who Democrats allege is seeking to coopt spending authority from Congress.
- Democrat action may also include delaying Trump nominees who may have otherwise received swift confirmation, like Commerce Secretary nominee, Howard Lutnick, who has his Senate Commerce Committee nomination hearing today.
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STIR: EURIBOR FIX - 30/12/24
| Tenor | Rate | Change |
| One-week | 2.912 | -0.023 |
| One-month | 2.867 | +0.004 |
| Three-month | 2.678 | -0.005 |
| Six-month | 2.562 | -0.015 |
| One-year | 2.454 | -0.011 |
CANADA: Ministers Leave Florida w/Out Tariff Assurances From Trump's Team
Canadian Finance Minister, Dominic LeBlanc, and Foreign Affairs Minister, Melanie Joly, met on Saturday with two key members of US President-elect Donald Trump’s incoming cabinet to discuss strategy to avoid a 25% tariff that Trump has threatened to impose unless Canada takes steps to secure the border.
- LeBlanc’s spokesperson described the Florida meeting with Trump's Commerce Secretary nominee, Howard Lutnick, and Interior Secretary/‘Energy Czar’ nominee, Doug Burgum, as “positive” and “productive”, noting the ministers “reiterated the shared commitment to strengthen border security" and "combat the harm caused by fentanyl." The spokesperson added that Lutnick and Burgum "agreed to relay information to President Trump.”
- Bloomberg reports: “It’s the second high-level Canadian mission to Trump’s Mar-a-Lago resort in the past month, after Prime Minister Justin Trudeau met the incoming leader at the end of November,” noting that "Trudeau’s response to Trump’s tariff threat has been complicated by chaos in his government" including the resignation of finance minister Chrystia Freeland, who suggested in her resignation letter that Trudeau wasn't taking the tariff threat seriously.
- The New York Times notes the Canadians outlined a USD$900 million package of border security measures but “returned home without any assurances,” from Trump’s team.
- The Times adds: “…Trump has suggested that his tariff plan may have less to do with border security than with his desire to eliminate the $50 billion trade deficit with Canada. Oil and gas exports from Canada account for most of that trade imbalance. Without them, the U.S. generally has a trade surplus with Canada.”
COMMODITIES: Gold Slippage Undermines Bullish Theme
Gold traded sharply lower on Dec 18. That move down undermines a recent bullish theme. A resumption of weakness would signal scope for an extension towards the key support at $2536.9, the Nov 14 low. Moving average studies are in a bull mode position. A bearish threat in WTI futures remains present and recent gains are - for now - considered corrective. A resumption of the bear cycle would open $65.57, the Oct 1 low, and $63.73, the Sep 10 low and key support.
- WTI Crude down $0.29 or -0.41% at $70.28
- Natural Gas up $0.32 or +9.31% at $3.706
- Gold spot down $6.44 or -0.25% at $2613.09
- Copper down $0.95 or -0.23% at $411.5
- Silver down $0.01 or -0.05% at $29.342
- Platinum down $3.07 or -0.33% at $921.83
