Ukraine in Talks with U.S. and Europe on Three Key Documents; Fed Chair Race Enters Final Stage

South Korea has signed a preliminary agreement with Peru to supply battle tanks and armored vehicles in its largest defense deal with a Latin American country as it seeks to expand its presence in the global arms market beyond Europe.

The deal, if finalized, could surpass 2 trillion won ($1.4 billion), Yonhap News said, without citing sources. It includes the potential sale of 54 K2 tanks and 141 armored vehicles by Hyundai Rotem Co. to the Peruvian army with a goal to sign a contract by next year, South Korea's presidential office said on Wednesday.

South Korea's presidential office and Hyundai Rotem declined to comment on the contract amount when reached by Bloomberg News.

"The scale of ground equipment exports under the framework agreement represents the largest defense export to Latin America," the presidential office said in a statement. It said if the deal is implemented it would be the first time Korea exported the K2 tank to Latin America. Previously it's only signed a deal to ship the tanks to Poland.

The announcement comes months after Poland signed a $6.5 billion deal to purchase K2 tanks in the NATO member's latest move to shore up its military capabilities following Russia's invasion of neighboring Ukraine.

South Korean defense manufacturers have gained a reputation for speed and reliability in recent years, honed by decades of preparing their armed forces for a potential conflict with their heavily militarized neighbor, North Korea.

South Korea is ranked as the world's 10th largest weapons exporter, according to a March report from the Stockholm International Peace Research Institute, and is aiming to become number four by 2027.

Source: Bloomberg Europe

President Donald Trump on Tuesday claimed to have "just heard" that all four of former President Joe Biden's appointments to the Federal Reserve were approved by "autopen," suggesting they are not authorized to serve in those roles.

Trump provided no evidence for the claim, which piggybacks on his repeated assertion that all of his predecessor's documents that were signed using an autopen are invalid.

But he said he thinks it is "something we have to look into." And he suggested that the list of autopen-signed appointees could include Fed Chair Jerome Powell, who has faced near-constant criticism from Trump over his handling of the central bank and U.S. interest rate levels.

Trump appointed Powell as Fed chair during his first presidential term. Biden reappointed Powell in 2021. Powell's term is set to expire in May.

Three other current members of the Fed's Board of Governors — Vice Chair Philip Jefferson, Governor Michael Barr and Governor Lisa Cook — are Biden appointees.

The autopen comments came during a campaign-style speech in Mount Pocono, Pennsylvania, where Trump had traveled to speak about the economy and counter Democrats' messaging about an affordability crisis in the U.S.

"By the way, it looks — you're gonna have to check this, please — I just heard, it could be that all four commissioners in the Fed signed by Biden ... I hear that the auto pen may have signed those commissions," Trump said.

Trump interspersed his accusation with criticism for Powell, derisively calling him "Too Late" and claiming JPMorgan Chase CEO Jamie Dimon had urged the central bank chief to lower rates.

"But I hear that the autopen may have signed those commissions. If they signed those commissions — now maybe I'm wrong, but we're going to check," Trump said.

He then appeared to address a member of his administration, asking, "Have you checked that? Are you hearing it? Who signed it? Did he sign it, or did the autopen sign it?"

"So, I don't know. I think it's something we have to look into," Trump said. "They put people there that are not authorized to be there."

Trump then said, "Would you check that, Scott?" appearing to refer to Treasury Secretary Scott Bessent.

"Because I'm hearing that the auto pen could have signed maybe all four, but maybe a couple of them," Trump said.

"We'll take two," he added.

Source: CNBC

US Trade Representative Jamieson Greer is set to speak with a top Indonesian official this week in hopes of salvaging a trade framework at risk of collapsing, the Financial Times (FT) reported Tuesday.

Greer is planning to talk with Airlangga Hartarto, the Indonesian coordinating minister for economic affairs, in an effort to revive a deal struck in July that would see US tariffs on Indonesian goods reduced from a threatened 32% to 19% in exchange for a series of concessions.

But US officials now believe Jakarta is reneging on agreements to eliminate non-tariff barriers on American industrial and agricultural exports, as well as digital trade issues, the newspaper reported. The two sides are also clashing over an effort by the US to include clauses that Indonesia sees as an infringement on its economic sovereignty, according to the FT.

Representatives for the White House and US Trade Representative did not immediately respond to a request for comment on Tuesday night, while Greer declined to comment.

Under the deal announced in July, Indonesia announced plans to purchase some US$19 billion (RM78.28 billion) in American products, led by 50 Boeing Co jets, and erase duties on imports from the US. The country also agreed to eliminate some requirements on products including local content that had complicated efforts to sell American products in the country. President Donald Trump said at the time he had dealt directly with Indonesian President Prabowo Subianto to finalize the agreement.

But because Trump moved first to reduce the tariff, officials in Jakarta felt little urgency to finalise the deal or move quickly to fulfill the commitments and intentionally looked to delay the concessions, according to people familiar with Indonesia planning.

Since then, Trump unveiled a flurry of trade frameworks with Thailand, Cambodia, Vietnam and Malaysia that saw similar agreements to reduce tariff barriers, including on industrial and agricultural products.

While the US president has eagerly agreed to sweeping trade pacts — and quickly adjusted tariff rates in response – fuller negotiations on specific terms have repeatedly proved protracted and difficult.

Greer on Tuesday night told a congressional panel that he expects to sign more trade deals in coming weeks, as global trading partners await a Supreme Court decision deciding the legality of the emergency authority behind President Donald Trump's sweeping tariffs.

Greer didn't specify which countries would be included in the upcoming trade deals.

Source: Theedgemarkets

Energy – Surplus outlook weighs on oil

Oil prices are under further downward pressure this week, with ICE Brent falling below $62/bbl, settling at its lowest level since late October. The oil market is moving deeper into the expected oil glut. Expect additional price pressure as we move into 2026, as discussed in our recently published outlook. However, Russian oil supply remains a risk. While Russian seaborne export volumes are holding up well, these barrels are struggling to find buyers. So, we are seeing increasing volumes of Russian oil at sea. Obviously, this is not sustainable. We need to see steeper discounts on Urals to attract buyers and/or Russian buyers, ensuring they are not dealing with sanctioned entities. If these fail, we will likely have to see Russian oil output starting to fall. Our base case remains that Russia will find ways to work around the latest US sanctions. Russia has demonstrated an ability to keep oil flowing since 2022 despite sanctions, embargoes and drone attacks.

American Petroleum Institute numbers yesterday were supportive for crude, but bearish for refined products. US crude oil inventories fell by 4.8m barrels over the last week, much more than the roughly 1.3m barrels decline the market expected. Refined products saw large stock builds. Gasoline and distillate inventories rose by 7m barrels and 1m barrels, respectively. If confirmed by the Energy Information Administration (EIA) later today, this would be the largest gasoline build since late December 2024.

The EIA published its latest Short Term Energy Outlook yesterday, estimating that US crude oil production will reach a record high of 13.61m b/d in 2025. This is up slightly from a previous estimate of 13.59m b/d. Yet, the EIA expects oil production to come under pressure next year, given the low price environment and the slowdown in drilling activity. The agency forecasts output to fall to 13.53m b/d in 2026, down from a previous 13.58m b/d.

European gas prices appear to have found a floor, bouncing higher yesterday; the Tittle Transfer Facility (TTF) settled 2.3% higher. The European gas market has been under significant pressure, amid aggressive selling by speculators. This is despite EU gas storage recently falling below 72%, compared with the 5-year average of 82% for this time of year. The weakness in TTF should lead to slower LNG flows into Europe, with JKM's premium to TTF widening in recent weeks. Meanwhile, the broader weakness in Europe has seen gas prices trading down towards the long-run marginal cost for US LNG producers. If these price levels persist, they will likely raise more questions about the viability of pre-final investment decision export projects.

Metals – Silver hits $60/oz

Silver prices rallied above $60/z -- a fresh record high -- in Tuesday's afternoon trading. This was fuelled by expectations that the Federal Reserve would cut interest rates this week and concerns over tightening supply. Historically, silver has outperformed gold during easing cycles, as lower real yields tend to lift both investor allocation and industrial activity. Silver prices are up around 110% so far this year, outpacing gold. Silver is supported by fears that the metal could be targeted in future US tariffs after being added to the Geological Survey's list of critical minerals last month. Mined silver production is down around 3% this year, with output constrained by declining ore grades and limited new project development.

Looking ahead to 2026, we expect silver prices to remain well supported by resilient industrial demand, constrained supply growth, and a more favourable macroeconomic environment.

Agriculture– WASDE bearish for wheat, bullish for corn

In its latest monthly WASDE report, the USDA decreased its estimates for US corn inventories for 2025/26 to 2.03b bushels compared to earlier estimates of 2.2b bushels. This was lower than the 2.15b bushels the market expected. Higher revisions primarily drove this to export estimates. For the global market, the USDA lowered its 2025/26 corn ending stocks estimate by 2.2mt to 279.2mt due to lower production. The USDA kept its 2025/26 domestic soybean ending stocks estimates unchanged at 290m bushels, while global ending stocks were marginally higher, from 122mt to 122.4mt. Finally, the agency kept its US wheat ending stocks estimates for 2025/26 unchanged at 901m bushels. Changes to the global wheat balance were more bearish, with the USDA raising its global ending stock estimates by 271.4mt to 274.9mt due to stronger output from several producers.

Source: ING

Silver prices hit a record high over $60 an ounce in early trade on Wednesday, as the white metal largely outperformed gold amid signs of tightening supplies and more attractive valuations.

Expectations that the U.S. Federal Reserve will cut interest rates later in the day also buoyed metal prices.

Spot silver rose to a record high of $60.9125 an ounce, while silver futures for March hit a peak of $61.430/oz.

Silver is trading up over 100% so far in 2025, having largely outpaced gold on expectations of tighter supplies in the coming months. The metal was also designated as a critical mineral by the U.S. government, strengthening its appeal.

Silver's relatively lower prices, especially in comparison to gold, also spurred buying of the white metal, especially as a run-up in gold made bullion appear more expensive. Silver is widely considered as a safe haven alternative to gold.

Gold prices were also upbeat on Wednesday, aided by a softer dollar as investors priced in a 25 basis point cut by the Fed in its last meeting for the year. Lower rates increase the appeal of non-yielding assets such as gold and silver.

Source: Investing

Chinese consumer inflation picked up slightly in November but still remained weak amid little economic relief, while pressure on the industrial sector saw producer inflation fall for a 38th consecutive month.

Consumer price index inflation rose 0.7% year-on-year in November, government data showed on Wednesday. The print was in line with expectations and accelerated from a 0.2% rise seen in the past month.

CPI inflation, however, still shrank 0.1% month-on-month, missing expectations for a 0.3% increase.

The mildly higher annual reading was driven by some holiday and shopping event-linked spending through November, with the "Singles day" event having taken place in the first two weeks of the month. A lower basis for comparison from last year also boosted November's reading.

Consumer sentiment took some support from Beijing's pledges to dole out more fiscal stimulus, with the recent Politburo meeting of the Communist Party reiterating this message.

But Chinese consumers still remained largely on edge over a cooling economy, especially as fears of a real estate crisis reemerged during November.

Chinese factory gate inflation continued to weaken, signaling little relief for local manufacturers. Producer price index inflation shrank 2.2% in November, more than expectations for a 2.0% drop. The print also marked a 38th consecutive month on contraction for PPI inflation.

Chinese factories were battered by weak local demand, high production levels in recent years, while trade tariff-related headwinds eroded export demand in 2025.

Source: Investing