Fed Holds Firm on Rates, Skeptical of Productivity's Role

Russia has drafted a new bill designed to integrate cryptocurrency into daily life and the broader national economy, according to Anatoly Aksakov, a senior lawmaker leading the country's digital asset regulation efforts.

The legislation, which will be a focus of the upcoming spring parliamentary session, aims to simplify crypto operations and is expected to provide a major boost to Russia's domestic crypto sector.

New Legislation Targets Mass Adoption

Anatoly Aksakov, who chairs the State Duma's Committee on Financial Markets, confirmed that the proposed law would exempt cryptocurrencies from special financial regulations, positioning them to become a commonplace tool for Russian citizens.

"A bill has already been drafted that would exempt cryptocurrencies from special financial regulation, meaning they will become commonplace in our lives," Aksakov stated.

He elaborated that the primary goal is to make digital currencies accessible to most Russians while weaving them into the country's economic fabric. The reforms are intended to create a powerful impetus for the development of the crypto industry under domestic rules.

Under the proposed framework, Russian residents could use digital coins for international settlements and to attract foreign capital by placing assets on international financial markets.

How the New Rules Will Affect Investors

The legislation outlines a two-tiered system for market participation:

• Professional Participants: Financial market professionals will be able to work with cryptocurrencies without restrictions.

• Non-Qualified Investors: Everyday citizens will also have access, though it will be restricted.

This approach marks a significant liberalization from previous policies.

From Sanctions to Crypto: Russia's Policy Shift

This legislative push is the latest step in a significant evolution of Russia's stance on cryptocurrency, largely driven by Western sanctions that have limited its access to traditional finance.

The year 2025 marked a turning point in the country's historically conservative attitude. Last spring, Russia introduced a special "experimental" legal regime that permitted the use of digital currencies for cross-border payments. That initial framework also allowed a small group of "highly qualified" investors to put money into crypto assets. By May, the Central Bank of Russia (CBR) authorized financial firms to offer crypto derivatives.

In late December, Russia's monetary authority released a new regulatory concept that recognized cryptocurrencies as "monetary assets" and aimed to expand investor access. Following this, in November, financial regulators began discussing the removal of strict requirements for crypto investors, such as minimum income thresholds and prior investment experience.

What to Expect by Mid-2026

The new legislation is expected to be adopted by July 1, 2026. Once enacted, it will allow regular qualified investors and ordinary citizens to legally purchase cryptocurrencies like Bitcoin.

However, for non-qualified investors, annual crypto purchases will be capped at 300,000 rubles (approximately $3,800).

Once a year, the Bloomberg Commodity Index, a widely tracked benchmark for a basket of commodities, resets its weights. The 5-day roll period started Thursday.

Source: Bloomberg

Rachel Reeves' fiscal rules are "among the loosest the UK has had in its history" and fail to control borrowing effectively compared to other advanced economies, according to the former head of the government's spending watchdog.

Richard Hughes, who resigned as chair of the Office for Budget Responsibility (OBR) in November, argued that the self-imposed rules do not constrain growth because they permit the government to run a "quite a big structural deficit."

In his first public appearance since stepping down, Hughes told a House of Lords committee that the UK is now much slower at correcting its finances after a major shock.

"The rules we have mean that righting the fiscal ship after a shock happens much more slowly at the moment in the UK compared to what other rules might have required had they remained in place or compared to other jurisdictions," he said.

National Debt Continues to Climb

Hughes' comments underscore a critical challenge for the UK economy. Despite Reeves acknowledging that 10% of government spending goes toward debt interest, the national debt is still rising. Currently at 95.6% of GDP, or £2.9 trillion, UK debt has reached levels not seen since 1963 and is projected to climb to 97% of GDP by 2029.

The criticism from Hughes follows a chaotic budget process last November. Reeves raised taxes by £26 billion, a move designed to more than double her buffer against her fiscal rules to £21.7 billion and reassure markets.

A Flawed Target Allows Perpetual Borrowing

Hughes explained that Reeves' fiscal framework is not strong enough to stabilize the public finances. He pointed to a specific mandate that taxes must cover day-to-day spending by 2029-30, a rule he claims allows borrowing of as much as 3% of GDP annually.

Crucially, he noted, this target never actually needs to be met. Once 2029-30 becomes the third year of the forecast, the target date simply rolls forward each year.

"We are still piling up debt several years on from a shock," Hughes stated, referencing the impacts of Covid and the energy crisis. "We aim to get borrowing to 2.5% of GDP by the end of the decade. That's a level the average advanced economy reached two years ago. Other countries have been much faster at rebuilding fiscal resilience."

He added, "I don't see much evidence of the government being constrained in its ability to support the economy."

High Debt, Not OBR Forecasts, Is the Real Constraint

Hughes also pushed back against claims that the OBR has become too powerful and that its forecasts are overriding elected officials—an argument made by figures including former Bank of England governor Andy Haldane.

He insisted the problem is not the OBR's analysis but the "record low level of headroom" against the rules used by both Reeves and her Conservative predecessor, Jeremy Hunt.

"Having a combination of relatively loose rules and also setting aside relatively small amounts of headroom is one of the reasons why fiscal outcomes have drifted," Hughes argued.

He concluded that the true economic limitation is the debt itself, not the watchdog that measures it. "Fiscal policy in this country is constrained because we've got debt approaching 100% of GDP and a deficit of almost 5% of GDP. Not because of the OBR forecast... we are borrowing more than almost any other advanced economy at the moment."

A major trade agreement between the Trump administration and Taiwan is in the final stages of negotiation, potentially reshaping semiconductor supply chains and U.S. trade policy in Asia. The deal centers on a U.S. tariff reduction in exchange for a massive expansion of chip manufacturing on American soil.

Former U.S. President Donald Trump, whose administration is spearheading the negotiations with Taiwan.

The Core of the Agreement: Tariffs for Fabs

Under the proposed terms, the United States would lower tariffs on Taiwanese exports from 20% to 15%. This would bring Taiwan's tariff level in line with regional competitors like Japan and South Korea, marking a significant win for the Trump administration's trade agenda.

In return, Taiwan Semiconductor Manufacturing Co. (TSMC), the world's leading chipmaker, is expected to commit to a substantial increase in its U.S. presence. This quid pro quo was a key expectation for U.S. officials, including Commerce Secretary Howard Lutnick, who pushed for significant new investment promises from Taiwan.

Taipei's Office of Trade Negotiations confirmed on Tuesday that both sides have reached a "broad consensus." Discussions are now underway to schedule a final meeting before the agreement is sent to the legislature for review.

TSMC's Massive Arizona Expansion

The centerpiece of Taiwan's commitment is a plan for TSMC to dramatically scale up its operations in Arizona. The company would agree to build five new chip fabrication plants (fabs) and two advanced packaging facilities in the state.

This expansion would roughly double TSMC's manufacturing footprint in Arizona. The new investment is projected to exceed $100 billion, considering a single fab costs around $20 billion to build in the U.S. These commitments are in addition to TSMC's existing plans for up to $165 billion in U.S. investment. According to reports, the new facilities are scheduled for completion sometime in the 2030s.

Geopolitical Stakes and Timing

The agreement carries significant geopolitical weight. A deal with Taipei risks provoking a strong reaction from China, which considers the self-governing island its own territory—a claim Taiwan's government rejects.

Aware of the delicate timing, officials in Taipei are reportedly pushing to finalize the pact before a planned meeting between President Trump and Chinese leader Xi Jinping. The U.S. president is expected to visit China in April, adding a sense of urgency to the trade talks.

A Potential Supreme Court Hurdle

Despite the progress, the entire agreement could be complicated or delayed by a pending U.S. Supreme Court decision. A ruling on the legality of Trump's tariffs is expected as soon as Wednesday, and an unfavorable outcome could render the current negotiations moot.

President Donald Trump recently outlined a bold plan for Venezuela: its interim government would supply the U.S. with up to 50 million barrels of oil, and America’s largest energy companies would move in to overhaul the nation's crumbling oil infrastructure. The goal, he said, was for these firms to "start making money for the country" again.

While this might sound like a golden opportunity, for the US oil majors, it looks more like a poisoned chalice. Venezuela sits on the world's largest crude reserves—more than Saudi Arabia and Iran combined—but accessing that wealth is fraught with technical, financial, and political dangers that even the biggest players are reluctant to face.

A History of Seizures and Mistrust

The primary obstacle is political risk. Venezuela’s history of nationalization casts a long shadow over any potential investment. In the 1990s, former President Hugo Chavez nationalized the oil industry. By 2007, he had forced out giants like Exxon and ConocoPhillips after they refused to hand a majority stake in their projects to the state-run oil company, PDVSA.

The financial wounds from that era have not healed. ConocoPhillips is still owed approximately $10 billion. Today, only Chevron is authorized to operate in Venezuela and export crude to the United States.

Industry leaders are deeply skeptical. At a recent meeting with Trump, Exxon CEO Darren Woods was blunt: "We've had our assets seized there twice, and so you can imagine to re-enter a third time would require some pretty significant changes."

According to a Reuters analysis, oil companies will hesitate to make major commitments until Caracas establishes a new government that can earn the trust of international investors and banks. Trump has offered security guarantees, but not capital, for new projects—a promise that may not be enough to overcome decades of instability.

Venezuela's Vast but Challenging Reserves

On paper, Venezuela’s oil wealth is staggering. As a founding member of OPEC, it holds an estimated 303 billion barrels of proven reserves, representing about 17% of the world's total and dwarfing the United States' 55 billion barrels.

Most of these reserves are concentrated in the Orinoco Belt, a massive territory in eastern Venezuela. However, PDVSA, which controls most operations, has been crippled by aging infrastructure, underinvestment, mismanagement, and sanctions. As a result, a country that once exported 3.5 million barrels per day now struggles to produce around 1 million.

The $100 Billion Price Tag for a Revival

Revitalizing Venezuela’s oil production would require an enormous capital injection. Francisco Monaldi, director of Latin American energy policy at Rice University's Baker Institute, estimates that returning to the peak production levels of the 1970s would demand an annual investment of $10 billion for the next ten years—a total of $100 billion.

Even more modest goals are costly. According to consulting firm Rystad Energy:

• Merely maintaining current production levels would cost $53 billion over the next 15 years.

• Raising production above 1.4 million barrels per day would require an additional $120 billion by 2040.

The Unforgiving Economics of Heavy Crude

Beyond the political and financial hurdles lies a fundamental technical challenge: Venezuela’s oil is extra-heavy crude. It is dense and highly viscous, making it far more difficult and expensive to extract than conventional light crude. Production requires advanced techniques like steam injection and blending with lighter oils to make it marketable.

This extra-heavy crude also sells at a discount due to its high density and sulfur content. While U.S. Gulf Coast refineries are equipped to process it, the economics are questionable, especially at low oil prices.

Consultancy Wood Mackenzie estimates that breakeven costs for key grades in the Orinoco Belt average more than $80 a barrel. With global oil prices hovering around $60 a barrel, Venezuelan production is simply uneconomical. For comparison, heavy oil from Canada has an average breakeven cost of around $55 a barrel.

Are the Reserves Overstated?

There is also growing doubt about the true size of Venezuela's commercially viable reserves. The country’s "proven reserves" are self-reported and were declared the world's largest by OPEC in 2011, a year when oil traded above $100 per barrel.

Proven reserves are defined as oil that has a 90% probability of being recovered with existing technology while remaining commercially viable. Since Orinoco oil is expensive to produce and refine, its viability is critically dependent on high prices.

Rystad Energy offers a more conservative estimate, suggesting Venezuela's realistic reserves are closer to 60 billion barrels. Unless prices spike significantly, much of the country's claimed oil wealth may remain theoretical.

A Gamble Few Are Willing to Take

For US oil companies, the bottom line is clear. Returning to Venezuela would require oil prices to rise by at least $20 a barrel just to break even. Even then, they would need ironclad guarantees that their multibillion-dollar investments won't be seized again.

With political risk at an all-time high and questionable economic returns, the Trump administration's vision of an American-led revival of Venezuela's oil industry appears disconnected from reality. As one analyst summarized, the world likely doesn't need more high-cost, dirty oil. The dream of a Venezuelan crude deluge will probably remain just that—a dream.

U.S. Treasury Secretary Scott Bessent convened a meeting with key international partners on Monday, urging them to build more resilient supply chains for critical minerals.

According to a statement from the Treasury Department, the Washington meeting focused on developing solutions to secure and diversify sources of these materials, with a special emphasis on rare earth elements.

Reducing Reliance on China

A U.S. official indicated Sunday that a primary goal of the talks was for Bessent to encourage allied nations to step up efforts to reduce their reliance on China for critical minerals. The push comes as Beijing has implemented strict export controls on rare earths.

The Treasury Department noted Bessent's optimism that nations will adopt a strategy of "prudent derisking over decoupling." He stressed that partners understand the urgent need to address current vulnerabilities in the critical minerals supply chain.

A Coalition of Key Global Players

The meeting brought together a significant group of nations and blocs. Representatives attended from:

• Australia

• Canada

• The European Union

• France

• Germany

• India

• Italy

• Japan

• Mexico

• South Korea

• The United Kingdom

Collectively, these participants account for 60% of the global demand for critical minerals.

China's Strategic Market Control

China holds a dominant position in the global critical minerals supply chain. Data from the International Energy Agency shows that China refines between 47% and 87% of the world's copper, lithium, cobalt, graphite, and rare earths.

These materials are essential components in a wide range of modern technologies, including defense systems, semiconductors, renewable energy hardware, batteries, and industrial refining processes.

Adding to recent tensions, China last week banned exports of certain dual-use items with military applications to Japan, a category that includes some critical minerals.