Kevin Warsh, Fellow in Economics at the Hoover Institution and lecturer at the Stanford Graduate School of Business, speaks during the Sohn Investment Conference in New York City, U.S., May 8, 2017.
Brendan McDermid | Reuters
Markets got what they wanted.
U.S. President Donald Trump tapped Kevin Warsh to lead the Federal Reserve, and investors exhaled. Markets were reassured by Warsh’s experience in the central bank — he served between 2006 and 2011, a period marked by the Global Financial Crisis — and the perception that he won’t always bend to Trump’s will.
“Kevin Warsh’s nomination for Fed Chair is exactly what markets were hoping for, as he’s a steady hand, well known in market circles and is expected to maintain the independence of the central bank, which is critical for markets,” said Richard Saperstein, chief investment officer of Treasury Partners.
The U.S. dollar strengthened following Trump’s announcement, signaling the market’s approval of Warsh’s credibility and perceived autonomy.
Risk assets, however, fell. On Friday, major U.S. indexes closed lower on the back of flagging tech stocks. Spot gold lost around 9% and spot silver — seen as safe-haven assets to hedge against U.S. volatility — plunged 31.4% for its worst day since March 1980 — with both precious metals continuing to fall across the weekend.
Cryptocurrency also plummeted, with bitcoin trading around $77,250, its lowest level since April, as of 7:45 a.m. Singapore time (6:45 p.m. ET).
Elsewhere, policy and politics are moving fast.
India on Sunday unveiled its Union Budget for fiscal year 2026. Finance Minister Nirmala Sitharaman said the government expects its fiscal deficit and debt-to-GDP ratio to dip, and plans to encourage manufacturing across several sectors. Separately, Trump said Saturday that India would buy Venezuelan oil in place of some Russian crude, Reuters reported.
For the week ahead in Asia, elections will be in the spotlight. Both Thailand and Japan will head to the polls on Sunday, with outcomes closely watched by markets and policymakers alike.
What you need to know today
Kevin Warsh, explained. While at the Fed from 2006 to 2011, Warsh played an important role in the design and implementation of programs to stabilize credit markets. However, Warsh emerged from the era as a Fed critic.
‘Confident’ government shutdown will end by Tuesday, said U.S. House Speaker Mike Johnson on Sunday. He added that he believes he has the votes to end the partial government shutdown by Tuesday.
AstraZeneca goes stateside. That comes days after it announced billions in investment in China. The company wants a close relationship with the U.S., its biggest market, but is attracted by China’s innovation-friendly landscape.
Major U.S. indexes fell on Friday, with the S&P 500 posting its third straight losing day but still notching a gain for January. Gold, silver and bitcoin plunged, while the U.S. dollar strengthened. The pan-European Stoxx 600 added 0.64%.
[PRO] Eyes on Alphabet and Amazon earnings. In a busy week of earnings, the Google-parent is set to announce results on Wednesday after the bell, while Amazon’s comes out on Thursday after markets close. CNBC’s Fred Imbert breaks down what to expect.
