Nomura Calls for Halt to Turkey's Interest Rate Cuts

The Trump administration is pushing to establish a critical minerals trading bloc with allied nations, using tariffs to set price floors and counter China's dominance over the global supply chain.

The plan aims to prevent China from flooding the market with low-cost materials to undermine potential competitors, a tactic highlighted during the recent trade war.

A New Alliance to Secure High-Tech Resources

U.S. Vice President JD Vance articulated the strategy at a State Department meeting, emphasizing the goal of creating a resilient and cooperative supply zone.

"We want members to form a trading bloc among allies and partners, one that guarantees American access to American industrial might while also expanding production across the entire zone," Vance said. "What is before all of us is an opportunity at self-reliance that we never have to rely on anybody else except for each other."

Critical minerals are essential components in everything from smartphones to jet engines. The trade disputes over the past year exposed how heavily most economies depend on these materials, a market overwhelmingly controlled by China.

"I think a lot of us have learned the hard way... how much our economies depend on these critical minerals," Vance stated at the meeting, which Secretary of State Marco Rubio hosted for officials from dozens of nations.

Project Vault: Building a Strategic Stockpile

This initiative follows President Donald Trump's recent announcement of "Project Vault," a plan to create a national stockpile of rare earth elements. The project is backed by a $10 billion loan from the U.S. Export-Import Bank and nearly $1.67 billion in private capital.

The administration's assertive move comes after China, which controls 70% of the world's rare earths mining and 90% of its processing, restricted supplies in response to U.S. tariffs. While Trump and Chinese President Xi Jinping agreed to a one-year truce in October, China's export limits remain tighter than before the trade conflict began.

"We don't want to ever go through what we went through a year ago," Trump said when announcing the project.

Pini Althaus, founder of USA Rare Earth, believes other Western nations will join the effort, having recognized their vulnerability to China's supply chain leverage.

Public-Private Partnerships Drive the Strategy

To jumpstart domestic production, the U.S. government has begun making direct investments in American producers. Last week, it extended $1.6 billion to USA Rare Earth in exchange for stock and a repayment plan.

Althaus noted that securing government funding has become as rigorous as meeting with private equity investors, with officials demanding terms that ensure a financial return for taxpayers.

Meanwhile, the U.S. Export-Import Bank's board approved the $10 billion loan—the largest in its history—to help establish the U.S. Strategic Critical Minerals Reserve. The reserve is designed to guarantee access for key manufacturers, including:

• Battery maker Clarios

• Energy firm GE Vernova

• Digital storage company Western Digital

• Aerospace giant Boeing

Bank President John Jovanovic described the project as a public-private partnership where "there are no free riders." He explained that manufacturers who benefit most are making long-term financial commitments, while the government's loan helps attract private investment.

Reshaping the Global Market

Industry experts believe the stockpile strategy could foster a "more organic" pricing model that operates independently of China. Wade Senti, president of magnet company AML, said this would directly counter Beijing's practice of using its market dominance to squeeze out competitors with artificially low prices.

The Trump administration is also injecting public funds elsewhere. The Pentagon has spent nearly $5 billion over the past year to secure its own access to critical materials after the trade war exposed the nation's dependence on China.

Bipartisan Support and Long-Term Hurdles

The administration's focus on mineral supply chains has garnered support across the political aisle. A bipartisan group of lawmakers last month proposed creating a new agency with a $2.5 billion budget to spur domestic production of rare earths and other critical minerals.

"It's a clear sign that there is bipartisan support for securing a robust domestic supply of critical minerals," Senators Jeanne Shaheen and Todd Young said in a joint statement.

However, experts caution that success will not be immediate. David Abraham, a rare earths specialist and author of "The Elements of Power," said building up a sufficient stockpile will be a long-term effort, especially while China's export restrictions keep materials scarce.

Abraham also pointed to a potential contradiction in the administration's policy. While working to secure the supply of critical minerals, it has simultaneously cut incentives for electric vehicles and wind turbines—key sectors that drive demand for these very elements in the United States.

Source: decrypt

The U.S. services sector remained stable in January, but a significant jump in business costs is signaling renewed inflationary pressure, potentially reversing a recent cooling trend.

The Institute for Supply Management (ISM) reported that its non-manufacturing PMI was unchanged at 53.8 last month. This figure, which indicates expansion, beat economists' forecasts of 53.5 and suggests the economy started the first quarter on steady footing. The services sector is a critical barometer, accounting for over two-thirds of all U.S. economic activity.

Rising Costs Point to Inflationary Risk

While the headline number was stable, a closer look reveals mounting cost pressures. The ISM survey's measure of prices paid by businesses climbed to 66.6 in January from 65.1 in December.

This increase coincided with signs of supply chain strain. The supplier deliveries index rose to 54.2, its highest level since October 2024. A reading above 50 signifies slower delivery times, which may have been worsened by frigid temperatures and heavy snow across the country.

This development presents a challenge to the view that inflation is firmly under control. Federal Reserve Chair Jerome Powell recently described the impact of import tariffs as a likely "one-time price increase." The central bank left its benchmark interest rate unchanged in the 3.50%-3.75% range last week.

New Orders Weaken as Exports Plunge

Growth in new business moderated, with the new orders gauge falling to 53.1 from 56.5. A sharp contraction in foreign demand was a primary driver of this slowdown. The measure for export orders collapsed to 45.0, its lowest reading since March 2023, down from 54.2 in the prior month.

This slump in exports may be linked to geopolitical friction. Respondents in the ISM's January manufacturing survey noted that U.S. tensions are fueling "anti-American" sentiment among buyers. President Donald Trump has implemented broad tariffs and last month announced temporary American control over Venezuela after capturing President Nicolas Maduro. He also threatened new tariffs against European allies over the sale of Greenland before retracting the statement.

Hiring in the Services Sector Slows

The employment picture in the services sector also softened. The ISM's employment index slipped to 50.3 from 51.7 in December, indicating a much slower pace of hiring.

A more comprehensive view of the labor market remains pending, as the Department of Labor's official employment report for January has been delayed following the partial government shutdown that ended on Tuesday.

GBPUSD TECHNICAL ANALYSIS – DAILY TIMEFRAME

GBPUSD - daily

GBPUSD TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME

GBPUSD - 4 hour

GBPUSD TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME

GBPUSD - 1 hour

Source: investinglive

Peace talks between Ukraine and Russia, facilitated by the United States, have started in the United Arab Emirates, even as Russian forces launched another wave of strikes across Ukraine.

Direct negotiations involving Ukrainian, Russian, and U.S. representatives resumed in Abu Dhabi on January 23-24. These meetings are a rare occurrence since Russia's full-scale invasion in February 2022.

US-Brokered Negotiations Kick Off in the UAE

Ukraine's lead negotiator, Rustem Umerov, confirmed the commencement of the talks on X, stating that the meeting began in a trilateral format.

"Next comes work in separate groups by specific tracks, after which a follow-up joint synchronization of positions is planned," he explained.

According to media reports citing a White House official, Steve Witkoff, special envoy for US President Donald Trump, is representing the United States in the negotiations.

Skepticism Mounts as Kremlin Holds Firm

Hopes for a significant breakthrough are low as the war nears its fourth anniversary. Kremlin spokesman Dmitry Peskov told reporters on February 4 that Russia's stance remains unchanged. He stated that Moscow's position is "absolutely clear and well understood by both Kyiv and the American negotiators."

This diplomatic effort is shadowed by what Ukrainian officials call a familiar Kremlin tactic: using talks to buy time while escalating military assaults in Europe's deadliest conflict since World War II.

Ukrainian political analyst Ihor Reiterovych warned that the United States might be underestimating Russia's territorial ambitions. Speaking to Current Time, he said there is "absolutely no guarantee" that Putin would stop after securing parts of Ukraine.

Reiterovych also stressed the need for stronger security guarantees for Ukraine, insisting they must be "written not like the Budapest Memorandum." He referred to the 1994 agreement where the U.S., Russia, and the U.K. guaranteed Ukraine's territorial integrity in exchange for the country giving up its nuclear arsenal.

Diplomacy Under Fire: Widespread Attacks Continue

The negotiations began just hours after Russia launched a massive barrage of missiles and drones, hitting the Ukrainian capital and other regions across the country.

The Ukrainian Air Forces reported on February 4 that Russian forces had launched over 100 drones at Ukraine overnight.

Regional authorities reported the following impacts from the attacks:

• Dnipropetrovsk Region: A drone attack resulted in two deaths—a 68-year-old woman and a 38-year-old man—and left two others wounded, according to Mykola Lukashuk, head of the regional administration.

• Odesa Region: An overnight Russian attack injured at least five people. Local authorities also reported damage to houses, kindergartens, and a school.

President Trump stated that Russian President Vladimir Putin honored a temporary ceasefire agreement, a deal that came to a close just as a major new wave of air strikes hit Ukraine.

Speaking to reporters on Tuesday, Trump confirmed that a one-week pause in attacks, which he personally requested from Putin, had expired on Sunday. "It was Sunday to Sunday, and it opened up and he hit them hard last night," Trump said. "He kept his word on that… we'll take anything, because it's really, really cold over there."

The agreement was first announced by Trump on Thursday, January 29. He explained that he had asked Putin to refrain from firing on Kyiv and other cities for a week due to the extreme cold weather, a request to which the Russian president reportedly agreed.

Russia Unleashes Largest Air Attack of 2026

Despite the brief pause, Russia launched what Ukraine's largest private energy company, DTEK, has called the biggest air attack since the beginning of 2026. The overnight assault on Tuesday targeted power generation and distribution facilities, leaving thousands of people without electricity.

A residential building in Kyiv sustains heavy damage following a Russian air strike on February 3, 2026.

The attack involved over 70 missiles and several hundred drones, which damaged power and thermal plants already undergoing slow and costly repairs.

This escalation coincides with a new round of trilateral peace talks. American, Ukrainian, and Russian representatives gathered in the United Arab Emirates on Wednesday for discussions expected to continue until Thursday in Abu Dhabi.

Ukraine Contests Timeline and Demands Sanctions

Ukrainian President Volodymyr Zelenskyy challenged the timeline of the truce, stating it only began last Friday, a day after Trump's public announcement, and therefore did not last a full week.

In a statement Tuesday night, Zelenskyy directly addressed the renewed attacks. "We await the reaction of America to the Russian strikes," he said. "It was the U.S. proposal to halt strikes on energy during diplomacy and severe winter weather. The president of the United States made the request personally. Russia responded with a record number of ballistic missiles."

Zelenskyy urged international partners to impose further consequences on Russia:

• U.S. Action: He called for progress on a new sanctions bill currently being worked on by the U.S. Congress.

• European Measures: He pushed for European partners to take "decisive steps" regarding the earnings Russia generates from its oil tankers.

"Russia must feel pressure so that it moves in negotiations toward peace," he added.

Humanitarian Crisis in Freezing Temperatures

The latest assault has intensified the humanitarian crisis, with Ukrainian officials describing it as a "winter genocide." The strikes occurred as temperatures in the capital dropped to -20°C (-4°F).

In the aftermath of the attack, more than 1,000 residential tower blocks in Kyiv were left without heating, marking a severe end to the short-lived truce negotiated by Trump and Putin.