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Goldman Sachs maintains its forecast of $3,000 per ounce of gold by December 2025, while UBS targets $2,900, citing US political uncertainty and structural demand from central banks as key factors. Both banks recommend gold as a hedge against inflation and geopolitical risks, with UBS suggesting a 5% allocation in a balanced dollar portfolio. They also see $2,500 as a strong support level for gold prices.
Financial markets are adjusting expectations regarding the next US treasury secretary, anticipating a commitment to tax increases and potential tariffs that could impact trade dynamics, particularly with China. As Eurozone trade data emerges, the focus on economic nationalism and bilateral trade balances intensifies, while industrial production shows signs of softness across major economies. ECB officials are set to speak, but the Federal Reserve remains the primary source of market uncertainty.
Private debt is rapidly evolving, presenting significant opportunities for investors and borrowers, particularly as banks shift focus from smaller businesses to larger corporate clients. This shift has led to the rise of private credit, projected to reach $2.8 trillion in assets by 2028, as non-bank lenders step in to fill the void left by traditional banks. The gradual repeal of the Glass-Steagall Act has further accelerated this trend, enabling increased bank mergers and a reduction in lending to smaller enterprises.
US inflation has risen to 2.60% in October, causing concern among investors as they anticipate the implications for monetary policy, particularly following a speech by Fed Chairman Jerome Powell. Meanwhile, fears of restrictive trade policies under Donald Trump have eased, but uncertainty remains regarding the new administration's direction and its potential impact on Germany's export-driven economy. Investors are closely monitoring upcoming economic data, including US retail sector figures and Chinese industrial production.
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Silver prices are under pressure following a rise in US inflation, with the October rate at 2.6%, up from 2.4% the previous month, while the core rate remains steady at 3.3%. The recent US presidential election outcome has reduced uncertainty, but investors are still eyeing upcoming economic data and potential interest rate cuts from the Federal Reserve.
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The recent appointment of Elon Musk and Vivek Ramaswamy to lead the new Department of Government Efficiency (DOGE) by Donald Trump has triggered an 87.77% surge in the DOGE memecoin. In related news, Trump proposed replacing federal income tax with import tariffs during a podcast interview, while inflation data and Federal Reserve rate decisions continue to shape economic expectations.
Germany has seen a significant decline in manufacturing output since 2019, losing over 9%, while countries like Poland and Greece experience industrial growth, with Poland's output rising by 23%. High energy costs and competition from China are major factors in this disparity, alongside limited fiscal stimulus in Western Europe. The Industrial Stress Index indicates a worsening outlook for European industry, exacerbated by high interest rates and investment rationing.
Donald Trump has publicly criticized Jerome Powell, the chairman of the US Federal Reserve, and expressed intentions to influence monetary policy, raising concerns about the Fed's independence. While Trump has suggested firing Powell and building a Bitcoin reserve, experts warn that such actions could harm the US economy. The likelihood of Trump successfully undermining the Fed's independence remains low, as Powell's term extends until May 2026, and significant changes would require legal adjustments.
The European Central Bank is urging Raiffeisen and UniCredit to maintain capital reserves to mitigate risks associated with their operations in Russia, where they lack effective control. This move may lead to increased capital requirements for both banks, reflecting their exposure to risky commercial real estate loans and the ongoing challenges in the region following the invasion of Ukraine.
The European Central Bank is urging Raiffeisen and UniCredit to maintain capital buffers against risks from their Russian operations, amid ongoing tensions following Russia"s invasion of Ukraine. Both banks are under pressure to reduce their activities in Russia, with Raiffeisen facing additional demands related to risky real estate loans. The ECB"s actions may lead to legally binding capital requirements as it assesses the banks" exposure to unacceptable risks.
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