Faltering Peace Talks, Shrinking Rate Cut Room, Markets Enter a Game of Stalemate

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Second-phase Gaza Ceasefire Yet to Be Agreed; BlackRock: Fed's 2026 Rate Cut Magnitude to Be Limited...

[Quick Facts]

1. TruIsrael and Hamas Renew Dispute, Second-phase Gaza Ceasefire Yet to Be Agreed.

2. Russia to Seek Revision of Key Provisions in US Latest Peace Proposal.

3. Zelenskyy: "Peace Plan" Draft to Be Submitted to Parliament for Vote or Referendum.

4. Initial Jobless Claims Unexpectedly Drop, December Unemployment Rate to Remain Elevated.

5. Morgan Stanley: US Enterprises Plan Further Price Hikes in 2026 to Offset Tariffs.

6. BlackRock: Fed's 2026 Rate Cut Magnitude to Be Limited.

[News Details]

Israel and Hamas Renew Dispute, Second-phase Gaza Ceasefire Yet to Be Agreed

Local time on December 24, Israel and Hamas renewed their disputes. The Israeli military stated that one officer was injured in an attack in the Gaza Strip on the same day and vowed to respond. Hamas claimed the blast was caused by bombs previously planted by the Israeli military, disclaiming all responsibility for the incident. Earlier reports indicated that US President Donald Trump plans to announce the entry of the Gaza peace process into its second phase and unveil a new governance structure for the Gaza Strip by December 25. As of December 24, however, delegations from Israel and Hamas are still in negotiations with mediators over the relevant terms.

Russia to Seek Revision of Key Provisions in US Latest Peace Proposal

Sources revealed that Russia will demand critical revisions to the updated version of the US-proposed Ukraine peace plan, including imposing additional restrictions on the Kyiv military. Moscow holds that the 20-point plan reached between Ukraine and the US is only a starting point for further negotiations, as it lacks provisions crucial to Russia and fails to address numerous outstanding issues.

Zelenskyy: "Peace Plan" Draft to Be Submitted to Parliament for Vote or Referendum

Ukrainian media reported on the 24th that President Volodymyr Zelenskyy stated Ukraine will submit the draft Russia-Ukraine "Peace Plan" to parliament for deliberation and a vote, or hold a nationwide referendum on it. Speaking to journalists, Zelenskyy said the 20-point draft "Peace Plan" will be put to a parliamentary vote, or Ukrainian citizens will decide on its approval via a referendum. He added that a presidential election and a referendum could also be held simultaneously.

Initial Jobless Claims Unexpectedly Drop, December Unemployment Rate to Remain Elevated

US initial jobless claims fell unexpectedly last week, yet the December unemployment rate may remain high amid a sluggish job market. The US Department of Labor reported on Wednesday that seasonally adjusted initial jobless claims dropped by 10,000 to 214,000 in the week ending December 20, beating economists' forecast of 224,000 in a Reuters poll.

Recent data has fluctuated due to challenging seasonal adjustments ahead of the holiday season. The labor market remains in what economists and policymakers call a hire-freeze, no-layoff pattern. While the US economy has retained resilience, the labor market has nearly stalled. Continuing jobless claims rose by 38,000 to a seasonally adjusted 1.923 million in the week ending December 13.

The uptick aligns with findings from The Conference Board's survey released on Tuesday, which showed consumers' perceptions of the labor market deteriorated this month to the lowest level since early 2021. The unemployment rate climbed to a four-year high of 4.6% in November, partly driven by technical factors related to the government shutdown.

Morgan Stanley: US Enterprises Plan Further Price Hikes in 2026 to Offset Tariffs

Michael Gapen, analyst at Morgan Stanley, said in a report that the latest GDP data indicated corporates have taken a major step to recoup tariff costs by raising output prices, which helps restore profitability and mitigate recession risks. Analysts noted that tariffs have sharply driven up non-labor costs over the past two quarters. Corporates initially responded by cutting hiring and absorbing profit declines, yet passed on more of these costs in Q3. Survey data showed that corporates intend to push prices higher further in 2026.

BlackRock: Fed's 2026 Rate Cut Magnitude to Be Limited

Amanda Lynam and Dominique Bly, strategists at BlackRock, stated in a report that the Fed is expected to deliver only modest rate cuts in 2026. With cumulative rate cuts of 175 bps in the current cycle, the Fed is edging closer to the neutral interest rate level. Barring a sharp deterioration in the labor market, there will be fairly limited room for further rate cuts in 2026. According to LSEG data, the market currently expects the Fed to implement two rate cuts in 2026.

[Today's Focus]

TBD BOJ Governor Kazuo Ueda Delivers Speech

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Julia Daniels

Japan's government revised up its economic forecast for the fiscal year to next March and projected that growth would accelerate in the following year, on the view that its massive stimulus package will boost consumption and capital expenditure.

The projections are the first to be compiled under Prime Minister Sanae Takaichi's administration, which has announced big spending plans aimed at cushioning the blow to households from rising living costs while promoting investment in growth areas.

Under the latest projections approved by the cabinet on Wednesday, the government expects Japan's economy to expand 1.1% in the current fiscal year, up from 0.7% growth estimated in August due to the smaller-than-expected hit from U.S. tariffs.

Growth is expected to accelerate to 1.3% in fiscal 2026 as robust consumption and capital expenditure offset soft overseas demand, according to the projections.

The government said it expects consumption to rise 1.3% next fiscal year, the same pace projected for fiscal 2025, as tax breaks and moderating inflation underpin household spending.

Capital expenditure will likely increase 2.8% in fiscal 2026, faster than an estimated 1.9% rise for the current fiscal year, due in part to the effect of subsidies and tax breaks aimed at promoting investment in crisis management and growth areas.

The government will use the estimates when it drafts the next fiscal year's state budget, which will be finalised on Friday.

The administration compiled a 21.3 trillion yen ($136.7 billion) stimulus package in November that included payouts to families with children, subsidies to cut utility bills, and fiscal spending to promote investment in areas such as infrastructure, artificial intelligence and semiconductor chips.

The next fiscal year's budget is likely to include record total spending in line with the administration's expansionary fiscal approach, which has heightened market concerns over debt over-supply and pushed up government bond yields.

Source: Investing

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Manuel

Commodity

Gold futures traded in New York have soared almost 71% this year, on pace for their best annual gain in 46 years. The last time gold had such a strong year, Jimmy Carter was president, a crisis was unfolding in the Middle East, inflation was soaring and the United States was in the midst of an energy crisis.

Today, tariffs are distorting international trade, conflict is raging with Russia’s war on Ukraine, there have been flare-ups between Israel and Iran and the US is seizing oil tankers off the coast of Venezuela. In times of uncertainty, investors turn to safe havens like gold.

Gold is considered a resilient investment, with investors expecting the yellow metal will retain its value in crisis, if inflation surges, or if currencies drop in value.

“Uncertainty remains a defining feature of the global economy,” said Joe Cavatoni, senior market strategist at the World Gold Council. “In this environment, gold has become increasingly appealing as a strategic diversifier and a source of stability.”

For some investors, gold’s flaw is that it does not pay income like bonds. But when the Federal Reserve cuts interest rates as it’s been doing over the past few months, bond yields tend to fall, making gold more appealing.

Gold futures traded around $2,640 a troy ounce at the start of this year. The yellow metal climbed above a record high $4,500 a troy ounce on Monday. Analysts at JPMorgan Chase expect prices to rise above $5,000 a troy ounce in 2026.

Gold’s increase of 71% this year has far outpaced the S&P 500, which has risen by just 18%. In 2024, gold futures gained 27% while the S&P rose by 24%.

Expectations for some Fed rate cuts in 2026 are supporting gold’s rise. A weaker US dollar is helping boost the price, too, as it makes buying gold relatively more affordable for international investors.

Gold jewelers and people who own gold jewelry are benefiting from higher prices. And the gold rush isn’t just fueled by Americans snapping up gold bars from Costco — it’s countries buying gold by the ton.

Central banks and geopolitics

Gold’s rise has been underpinned by central banks buying up more gold themselves, led by China.

One of the main reasons China’s central bank is increasing its gold holdings is to decrease reliance on American assets like US Treasury bonds and the dollar, according to Ulf Lindahl, CEO at Currency Research Associates.

The shift became noticeable after Russia’s invasion of Ukraine in 2022. Western governments moved to freeze Russian assets denominated in US dollars, prompting governments in Russia — as well as China — to look for ways to decrease exposure to American policy decisions, Lindahl said.

“The current wave of central-bank buying is different precisely because it is rooted in geopolitics,” Ole Hansen, head of commodity strategy at Saxo Bank, said in a note. “The freezing of sovereign reserves and the broader fragmentation of the global financial system have introduced a structural element to gold demand that is likely to persist for years.”

Central banks around the globe have accumulated over 1,000 tons of gold in each of the last three years, compared with an average of 400 to 500 tons per year across the previous decade, according to the World Gold Council.

Precious metals shine in 2025

Gold’s ascent has been followed by other precious metals such as silver, platinum and palladium.

Silver futures have soared a whopping 146% this year, while platinum futures have gained almost 150% and palladium futures have gained 100%.

For investors, precious metals serve as “a hedge against an increasingly uncertain world,” according to Hakan Kaya, portfolio manager at Neuberger Berman.

That trend could continue. Lindahl at Currency Research Associates said he expects gold to keep rising in 2026. With central banks increasing their gold reserves, it can leave less bullion circulating in the market. Increased demand from regular investors coupled with less available supply could lead to higher prices.

Also helping boost demand for precious metals: concerns about enormous government deficits and debt burdens, according to Matt Maley, chief market strategist at Miller Tabak + Co.

“As investors have become more cognizant of these issues, they have been looking toward gold as a safe haven,” Maley said.

Source: CNN

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Manuel

Cryptocurrency

Political

The escalating power of artificial intelligence and emerging quantum capabilities is poised to reshape global security, regulation and market design in 2026, according to leading figures across the blockchain and AI sectors.

Speaking with Yellow.com, experts points toward a structural shift where governments, enterprises and financial markets will increasingly depend on blockchain-based infrastructure, not for hype-driven adoption, but to withstand the next era of computational threats.

Across industry, concerns are mounting that AI systems and quantum tools have outpaced traditional cyber-defense models.

Blockchain To Become A National-Security Priority

As enterprises accelerate deployment of AI-driven automation, and as prediction markets, business platforms and data ecosystems grow more agent-native, the need for verifiable computation, tamper-proof data, and transparent system design is becoming unavoidable.

Shiv Shankar, CEO of Boundless, says the turning point is already here, describing the landscape as a “sword and shield” conflict in which AI and quantum computing act as offensive capabilities, while blockchain and zero-knowledge cryptography provide defensive guarantees.

“AI and quantum computing are the sword… Blockchain and zero-knowledge cryptography are the shield.”

He argues that tamper-proof ledgers and verifiable computation will become national-level infrastructure because “any manipulation is immediately detectable," he said.

That shift dovetails with a broader transition in how enterprises interact with AI tools.

AI To Reshape Enterprise Workflows And Regulatory Demands

Rather than relying solely on general-purpose chat interfaces, companies are expected to move towards orchestrator systems, AI agents that can set tasks, run workflows, and carry out continuous actions across internal and external environments.

Also Read: Dogecoin After The Election Surge: What Went Wrong With The $1 Thesis

Titus Capilnean, VP of Go-to-Market at Civic, notes that rising complexity around automation, personalization and compliance will force businesses to adopt explainable AI systems, verifiable models, and identity-backed agent interactions.

He says the next phase of AI adoption will require “memory, personalization, and orchestrators,” alongside privacy-preserving tools like passkeys and zero-knowledge proofs.

Prediction Markets Enter A Fully Agent-Driven Phase

Prediction platforms, once dependent on human liquidity, are beginning to integrate fully autonomous agent economies.

David Minarsch of Olas says the key unlock is not simply better forecasting models, but the ability for agents to run the full lifecycle of prediction markets, creating markets, sourcing information, trading, and resolving outcomes.

That agent-native structure, he argues, allows prediction markets to scale to any question where incentives matter.

At the same time, he warns that trust must be “engineered into the mechanism,” as recent governance failures in crypto prediction markets show that volume alone doesn’t guarantee reliability.

Meanwhile, user attention is concentrating around breakout platforms.

Yu Hu, CEO of Kaito AI, says 2025 revealed an important pattern: even during a market downturn, sectors like perpetual DEXs and prediction markets saw explosive growth.

He points to Polymarket as a leading example heading into 2026, supported by on-chain rails and mainstream user engagement.

Source: YellowNews

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Political

Nasry Asfura, the conservative National Party candidate backed by U.S. President Donald Trump, has won Honduras' presidential election, the electoral body said on Wednesday as it finally declared a victor of the November 30 presidential election after weeks of delays, technical problems, and allegations of fraud.

The electoral authority, known as the CNE, said Asfura had won 40.3% of the vote, edging out center-right Liberal Party candidate Salvador Nasralla who garnered 39.5%. The candidate of the ruling LIBRE party, Rixi Moncada, came a distant third.

Results were so tight and the ballot processing system so chaotic that around 15% of the tally sheets comprising hundreds of thousands of ballots had to be counted by hand to determine the winner.

The results were approved by two electoral council members and one deputy, as disputes continued over the razor-thin vote. The third council member, Marlon Ochoa, was not present in the video declaring the winner.

"Honduras: I am ready to govern. I will not let you down," Asfura said in a post on X following the confirmation of the results.

The head of the Honduran Congress rejected the CNE's declaration, however, describing it as an "electoral coup".

"This is completely outside the law. It has no value," Congress president Luis Redondo, of the ruling LIBRE party, wrote on X.

Trump threw his support behind Asfura, a 67-year-old politician and businessman who is the former mayor of the capital Tegucigalpa, writing in a Truth Social post before the election that he was the "only real friend of Freedom in Honduras" and urging people to vote for him.

Trump also threatened to cut off U.S. financial support to Honduras if Asfura did not win and pardoned former President Juan Orlando Hernandez, also of Asfura's National Party, who had been serving a 45-year sentence in the U.S. on drug trafficking and weapons charges.

Amid delays in the count, Trump weighed into the election again alleging fraud without providing evidence and saying there would be "hell to pay" if Honduras changed preliminary results that had put Asfura ahead.

Trump's backing of Asfura, experts say, is part of his push to mold a conservative bloc across Latin America, stretching from Nayib Bukele in El Salvador to Javier Milei in Argentina.

Both Nasralla and the ruling LIBRE party have decried Trump's comments as election meddling.

Nasralla told Reuters that the last-minute interference from Trump had damaged his chances of winning.

Source: Reuters

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Manuel

Political

Energy

The US government is extending an emergency trucking waiver in the Northeast as winter weather and a power outage at a major industrial plant tighten propane supplies. More states were also added to the measure.

The Federal Motor Carrier Safety Administration on Tuesday extended an emergency declaration, originally set to expire midnight Friday, through Jan. 15. The measure waives regulations on how long drivers can be at the wheel without rest as they distribute heating fuels to thousands of customers in the Northeast.

The waiver is aimed at making sure enough fuel is being transported to fill any gaps, with sufficient inventories helping to provide a cushion amid the plant disruption. The declaration applies to propane, natural gas and heating oil. While just a minority of houses in the Northeast rely on these fuels for residential heating, cold weather in the forecast means it’s critical to keep supplies flowing.

The declaration was first issued Dec. 12 and applied to New York, New Jersey, Delaware and Pennsylvania. The expanded order now also waives trucking restrictions in Connecticut, Maryland, Massachusetts, New Hampshire and West Virginia.

The issue stems from a Nov. 19 electrical incident at a transformer at Energy Transfer LP’s Marcus Hook terminal in Pennsylvania. The outage disabled the facility’s ability to load propane on trucks for three days and led the company to declare force majeure, according to a statement from the National Propane Gas Association.

Energy Transfer customers were placed on allocation, meaning they could only collect a portion of their contracted purchases, and were receiving 70% of their loads, the association said.

Energy Transfer hasn’t responded to multiple requests for comment since states began issuing emergency trucking waivers in early December.

So far, fuel stockpiles and the ability for distributors to source propane from other plants have minimized the impact on consumers and prices.

Propane inventories on the East Coast are in line with prior-year levels, and retail prices in the region are up about 5 cents since the outage began according to US Energy Information Administration data.

Moderate weather during the Christmas holiday on the Eastern Seaboard will be swiftly followed by two cold shots — one on Dec. 26, and then into next week, said Sean Bratton, a meteorologist for Commodity Weather Group. A blast of cold air from Alberta will swoop down into the US Northeast on Friday and push down into the Mid-Atlantic states. The Tri-State area could see 2 to 5 inches (5 to 13 centimeters) of snow, with some areas potentially seeing even heavier bands dropping as much as 6 inches.

Source: Bloomberg

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Manuel

Forex

Economic

The Canadian dollar strengthened to a near five-month high against its U.S. counterpart on Wednesday as recent strength in commodity prices helped support the currency, offsetting preliminary domestic data that showed a steep decline last month for factory sales.

The loonie was trading 0.1% higher at 1.3672 per U.S. dollar, or 73.14 U.S. cents, after touching its strongest intraday level since July 25 at 1.3666.

"The broader softening in the USD over the past month has helped lift the CAD but narrower US/Canada spreads, positive economic data surprises - relative to US economic data outcomes - and recent gains in commodity prices are all helping lift CAD sentiment," Shaun Osborne and Eric Theoret, strategists at Scotiabank, said in a note.

The price of oil, one of Canada's major exports, edged higher for a sixth straight day as investors weighed the risk of supply disruptions from Venezuela and Russia. U.S. crude futures were up 0.1% at $58.43 a barrel.

The gap between Canada's 2-year yield and its U.S. equivalent has narrowed to 94 basis points in favor of the U.S. note from 120 basis points at the end of October, reducing the relative attractiveness of the U.S. currency.

Minutes released on Tuesday of the Bank of Canada's latest interest rate decision on December 10 showed that policymakers found it hard to predict whether the central bank's next move would be a hike or cut.

Domestic data added to recent evidence that has pointed to an economic slowdown in the current quarter after a stronger-than-expected increase in third-quarter GDP. According to a preliminary estimate, factory sales fell 1.1% in November from October on decreases in the transportation equipment and food subsectors.

Canadian bond yields edged lower across the curve, with the 10-year down 1 basis point at 3.408%. The bond market was set to close early ahead of the Christmas Day and Boxing Day holidays.