Japan’s Takaichi Calls Trump Talk "extremely Meaningful," Plans US Visit

Japanese Prime Minister Sanae Takaichi said she had an "extremely meaningful" call with President Donald Trump and would visit the US leader later this year amid heightened tensions in the region sparked by recent Chinese military drills around Taiwan.

"At President Trump's invitation, we also concurred to coordinate in detail to realize my visit to the United States this spring," Takaichi wrote in a Friday post on X.

The call between the two allied leaders comes after China's military simulated a blockade of Taiwan, a self-governing island Beijing claims as its territory, for two days with live-fire exercises. China also launched long-range projectiles into the Taiwan Strait — one of the world's busiest shipping lanes — for the first time since 2022.

Trump initially dismissed the drills as a continuation of longstanding Chinese activity and touted his "great relationship" with Chinese President Xi Jinping. The US State Department, however, in a statement on New Year's Day accused Beijing of increasing "tensions unnecessarily."

Relations between Japan and China have also frayed in recent weeks after Takaichi publicly said Tokyo could deploy its military if Beijing attacked Taiwan. Beijing responded by unleashing a wave of punitive measures, including curbing imports of Japanese seafoods and discouraging Chinese residents from visiting.

Takaichi has refused to retract her comments, saying that Japan's policy on Taiwan is unchanged.

Trump and Takaichi also spoke in late November, when the US president briefed her on a call with Xi and the latest on US-China relations.

More broadly, the recent Chinese drills pose a test of Trump's support for Taiwan after the US in December approved an $11 billion weapons package for the island, drawing Beijing's ire. China has launched a diplomatic push to stabilize ties with the US while also trying to make clear to Washington that it sees Taiwan as a red line.

The Trump-Takaichi call also comes as the US and Japan move to expedite a plan for Tokyo to invest $550 billion in the US, part of a broader trade agreement to lower tariffs. The final green light for investments will be given by Trump based on recommendations from a committee.

Source: Bloomberg Europe

Israeli media is reporting that Israel and the United States have reached an understanding to give Hamas a two-month ultimatum to finally and fully disarm. The reports say the agreement came immediately after an overnight meeting between Israeli Prime Minister Benjamin Netanyahu and US President Donald Trump at Mar-a-Lago at the start of the week.

The move is being described as a fixed deadline rather than an opening for negotiations. Israeli and US teams are already reportedly working simultaneously to determine what they describe as "practical disarmament." This after Hamas has effectively been defeated since it launched the brutal Oct.7, 2023 terror assault on southern Israel.

Source: Washington Post/Getty Images

Another key focus is the dismantling of Hamas's underground tunnel network throughout Gaza, which Israeli officials consider a core element of the group's military strength.

Hamas has throughout the Gaza war proven itself effective in guerilla and insurgency tactics, utilizing small teams to maneuver quickly in and out of the tunnels, even at times taking out IDF tanks with IEDs. Sometimes bombs are even attached to Israeli armor vehicles by hand in these ambushes, after which a Hamas militant darts back into an underground tunnel, as has been demonstrated in various videos.

Sources quoted by Israel Hayom said Israeli officials doubt Hamas that would be willing or able to relinquish most of its weapons or military capabilities within the two-month window.

From the perspective of Hamas leadership, the moment it fully gives up its weapons means the group is effectively dead and will have no more influence to govern in the future.

But this is also exactly what the US-Israeli plan and the ceasefire calls for: the effective end of Hamas rule in governance in the Gaza Strip forever.

PM Netanyahu while giving media interviews during his December US trip described that Hamas still possesses "around 60,000" Kalashnikov rifles and "hundreds of kilometers" of tunnels.

He has vowed that Hamas disarmament can be achieved "the easy way" or the hard way - that is through military force. But as of last summer, Hamas was insistent that it will never give up its weapons.

There's also the possibility that Hamas leadership won't be able to induce all of its fighters and 'ground troops' to give up their weapons - again, as they would fear being tracked down and killed by Israeli forces.

Source: Zero Hedge

Gold and silver prices are higher in early U.S. trading Friday, with silver sharply up. Safe-haven demand is featured amid rising tensions between the U.S. and Iran. Both metals continue to experience high daily price volatility. February gold was last up $51.00 at $4,393.00. March silver prices were up $2.692 at $73.29.

Trump warns Iran's military not to attack Iranian protesters. President Trump said the U.S. will come to the rescue of Iranian protesters if they are attacked by Islamic Republic authorities. "If Iran shots and violently kills peaceful protesters, which is their custom, the United States of America will come to their rescue," Trump said in a Truth Social post early Friday and as reported by Bloomberg. "We are locked and loaded and ready to go." Iranian Security Council Secretary Ali Larijani responded on X, saying the U.S. "should be mindful of their soldiers' safety." The Trump post, around 3 a.m. Washington time and late morning in Iran, came after protests over a currency slump and soaring prices spread beyond Tehran to cities nationwide. The Iranian currency, the rial, hit a record low on Sunday and worsened an economic crisis in a country already beset by crippling international sanctions. Clashes have broken out between civilians and security forces and at least seven people have been killed in four cities in recent days, according to the AP.

Global stock markets starting 2026 on strong note. European equity markets extended their rally on the first trading day of 2026, with benchmark indices pushing to fresh record highs despite thin liquidity following the New Year holiday. Gains were led by defense stocks, underpinned by persistent geopolitical tensions and expectations of increased military spending across the region. The STOXX 50 climbed 1.1% to a new all-time high of 5,850 points, while the broader STOXX 600 rose 0.5% to a record 596 points. The FTSE 100 surged around 1% on the first trading day of 2026, breaking above the symbolic 10,000-point level for the first time in its history. The DAX in Frankfurt rose 0.4% to approach 24,600 in the first trading session of 2026, setting fresh record high. The Hong Kong Hang Seng surged 708 points, or 2.8%, to finish at a six-week high of 26,384 on Friday, rebounding from previous weakness amid widespread sector strength. Meantime, India's BSE Sensex closed about 0.67% firmer at 85,762 on Friday, an all-time high, supported by broad-based buying across most sectors. Looking ahead, global investors are searching for fresh catalysts, with close attention on the U.S. interest rate outlook, while geopolitical developments remain a key backdrop for market sentiment. U.S. stock indexes are pointed to higher openings today.

U.S. Treasury market remains flat. The yield on the 10-year U.S. Treasury held around 4.10% on the first trading day of 2026, as Treasury market activity remained thin following the holidays. Investors continue to weigh the Federal Reserve's interest rate path this year, focusing on upcoming economic releases, including December payrolls due next week, which could shed light on the U.S. labor market and its implications on interest rates. Earlier this week, minutes from the Federal Reserve's FOMC's December meeting showed growing openness among policymakers to easing monetary policy if inflation continues to cool. However, FOMC officials remained divided over the timing and scale of potential cuts. Traders are pricing in two Fed rate cuts in 2026. Markets are also watching Fed leadership, with President Trump set to name Powell's successor early this year amid speculation of a dovish pick.

The key outside markets today see the U.S. dollar index slightly up. Crude oil prices are weaker and trading around $57.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.11%.

Technically, February gold futures bulls' next upside price objective is to produce a close above solid resistance at the contract/record high of $4,584.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,200.00. First resistance is seen at the overnight high of $4,414.80 and then at $4,433.00. First support is seen at the overnight low of $4,337.30 and then at $4,300.00. Wyckoff's Market Rating: 7.0.

March silver futures see this week's price action still appearing to have produced a big and bearish buying exhaustion tail, whereby the bulls run out of gas at the high and prices back way off to close near the daily low. Silver also saw a big and bearish "key reversal" down on the daily bar chart Monday. The bulls' next upside price objective is closing prices above solid technical resistance at Monday's record high of $82.67. The next downside price objective for the bears is closing prices below solid support at $67.50. First resistance is seen at the overnight high of $74.21 and then at $75.00. Next support is seen at $72.00 and then at the overnight low of $70.515. Wyckoff's Market Rating: 7.0

Source: Kitco

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Source: fxempire

Source: Bloomberg

The Treasury market in 2025 had its best year since 2020 as US trade policy shifts curtailed economic activity and the Federal Reserve cut interest rates in response to weakening labor-market conditions.

At the same time, Treasury yields remained confined to ranges in place roughly since the end of the Fed's historic 2022-2023 tightening cycle. The 10-year, for example, ranged from 3.86% to 4.81%, its narrowest band since 2021.

Yield declines were biggest for short maturities, and the 30-year increased slightly, amid expectations at year-end that the Fed was likely to cut rates further in 2026.

During the year, in which US President Donald Trump took office in January, the Treasury market drew support from economic uncertainty created by the turbulent roll-out of tariffs, broadly mounting expectations for Fed rate cuts, and a record six-week government shutdown that curbed growth.

Meanwhile, yields faced upward pressure from the dire long-term fiscal outlook, predictions that tariffs would cause inflation, and indications of accommodative financial conditions including record highs for US stock-market benchmarks and robust corporate bond issuance.

The Trump administration's drive to change the leadership of the Fed in pursuit of lower interest rates drove short-term Treasury yields lower and long-term ones higher, reflecting concern about unwarranted rate cuts keeping upward pressure on inflation.

For 2026, most Wall Street interest-rate strategists expect stable-to-higher Treasury yields as the Fed's rate-cutting cycle comes to an end.

Source: Bloomberg Europe