Recap | 14 January 2026
- Edward von der Schmidt
- 2 days ago
- 8 min read
US withholds response to Iran's crackdown amid tension
Denmark cites 'fundamental disagreement' over Greenland
US data points to ebbing price pressures, resilient activity
Central bankers reiterate importance of Fed independence
Equities relent as technology, bank stocks drag; oil and silver retreat
China posts record surplus on diversified trade flows
Japan plans elections while boosting ties with South Korea, Philippines
US announces second phase of peace agreement in Gaza
US approves restricted Nvidia chip sales to China
UAE joins US-led secure supply chain initiative
EU outlines lending to Ukraine
Europe bolsters tech cooperation
US pauses certain visa processing for 75 countries
Appeals court upholds California redistricting
Central banks experiment with digital payments processing
US crypto legislation goes back to the drawing board
EDWARD VON DER SCHMIDT
Headlines
US withholds response to Iran's crackdown amid tension
After suggesting on Tuesday that a US response in support of protesters could be imminent, President Trump declined to commit to military action in Iran on Wednesday. The pullback eased fears of another intervention and potential for destabilizing conflict.
Airspace closures in Tehran and limited evacuations of US personnel at bases in Qatar and neighboring countries appeared precautionary. The Iranian government denied plans to execute detainees and demonstrations subsided.
The US requested an emergency hearing at the UN on Thursday as other countries condemned the brutal repression that has left thousands dead.
AP:
Iran signals plans for fast trials and executions while promising 'decisive response' to US, Israel
Trump claims killing of Iran protesters 'has stopped' even as Tehran signals executions ahead
Iran's nationwide protests feel smothered after a weeklong crackdown and internet outage
Reuters:
Iran warns of retaliation if Trump strikes, US withdraws some personnel from bases
Trump says killings in Iran subsiding as experts warn on military intervention
Bloomberg:
Trump Signals He'll Hold Off Another Attack on Iran for Now
How Iran Sanctions and a Currency Crash Triggered Mass Protests
WSJ:
Iran Signals Plans for Swift Trials and Executions of Protesters
Trump Says Iran Has Stopped Killing Protesters
Denmark cites 'fundamental disagreement' over Greenland
A high-level meeting in Washington led by Vice President Vance and Secretary of State Rubio failed to resolve a "fundamental disagreement" with Denmark and Greenland over President Trump's insistence on bringing the mineral-rich island under US control.
Impasse aside, the delegations agreed to establish a working group to continue dialogue. Meanwhile, a subset of European NATO allies planned small-scale exercises in a nod toward bolstering Arctic security.
AP:
Denmark, Greenland leaders stand united against Trump's Greenland takeover call ahead of key meeting (1/13)
Danish official says there's a 'fundamental disagreement' with Trump over Greenland
Reuters:
Trump reiterates desire for Greenland following high-stakes meeting
Europeans prepare military exercises in Greenland as Trump's ambitions undeterred
Bloomberg:
Denmark Sees 'Fundamental Disagreement' With US on Greenland
Denmark-US Rift Persists as NATO Nations Deploy to Greenland
WSJ:
Trump Not Persuaded to Abandon Greenland Pursuit After White House Talks
US data points to ebbing price pressures, resilient activity
Lagged Consumer Price Index (CPI) data released Tuesday and Producer Price Index (PPI) data released Wednesday pointed to contained inflation pressures. Core measures (i.e., excluding energy and other volatile components) hinted that tariff-related price effects may be running their course. Assumptions of zero inflation for categories without sufficient data (due to the shutdown) may have artificially lowered the readings.
Delayed retail sales figures offered evidence of solid consumer spending, albeit concentrated in discretionary purchases and driven by the more affluent. Existing home sales also exceeded expectations, but housing activity remained subdued compared to recent years.
The latest Federal Reserve Beige Book corroborated narratives of economic resilience.
AP:
Inflation cooled slightly in December though it remains above Fed's target (1/13)
Producer prices rise a mild 0.2% in November, government says in report delayed by federal shutdown
Retail sales rose a better-than-expected 0.6% in November as the holiday season kicked into gear
Reuters:
US consumer inflation increases steadily, but households paying more for food and rents (1/13)
Strong US retail sales in November showcase economy's resilience
US existing home sales accelerate in December
Fed survey suggests slight upgrade to US economy
Bloomberg:
US Core CPI Rises 0.2%, Bucking Estimates for Bigger Rebound (1/13)
Prices Paid to US Producers Rise on Jump in Energy Costs
US Retail Sales Rebound on Car Buying, Holiday-Season Sales
Fed Beige Book Shows Economy Picking Up, Employment Unchanged
WSJ:
Pace of Inflation Held Steady in December; Consumer Prices Up 2.7% on Year (1/13)
Wholesale Prices Rose Less Than Expected in November
Retail Sales Brightened in November
Home Sales in December Jump 5.1%, Biggest Gain in Nearly 2 Years
Banks Say U.S. Consumers Remain Resilient Despite Economic Pressures
Markets & Economies
Central bankers reiterate importance of Fed independence
The heads of major central banks and leading financial institutions voiced support for Fed Chair Powell and emphasized the criticality of independent monetary policy. FOMC officials also lent support to Powell while flagging an anticipated hold at the January meeting.
In a wide-ranging interview with Reuters, President Trump repeated his criticisms of the Fed Chair but denied plans to terminate him at this time.
Comment: If the Supreme Court determines that President Trump can fire Governor Cook based on unsubstantiated allegations, he will likely fire Powell for the same in order to take control of the Board and the FOMC. The hearing on January 21 will presage a landmark ruling.
Reuters:
Trump says he has no plan to fire Fed's Powell despite investigation
Global central bankers defend Fed's Powell after Trump threat
Bloomberg:
Fed Officials Stress Independence as Rate Hold Signals Mount
Equities relent as technology, bank stocks drag; oil and silver retreat
Major equity indices ended in the red on Wednesday even as a majority of stocks rallied. Technology-sector losses were accompanied by declines in financials, notwithstanding bank earnings releases that highlighted substantial profits (and firm spending trends).
In commodities, oil gave back a chunk of recent gains as Iran tensions appeared to diminish.
President Trump's decision to eschew tariffs on critical minerals prompted a sharp pullback in silver after precious metals had climbed to new heights in earlier trading.
AP:
Wall Street slumps as bank and tech stocks fall
Big banks report soaring profits amid tensions with Trump over credit card interest rates
Reuters:
Oil prices sink more than 2% as Trump remarks calm concern about Iran
Trump says no critical minerals tariffs for now, will seek overseas supplies
Tech, banks weigh on Wall Street; Trump eases Iran oil fears
Bloomberg:
Blistering Metals Rally Sends Gold, Silver, Copper to Records
Oil Falls After Trump Signals US Response to Iran is On Hold
Oil and Silver Lead Commodity Losses, Stocks Fall: Markets Wrap
Silver Tumbles After Trump Holds Off on Critical Mineral Tariffs
WSJ:
Tech Selloff Weighs on Nasdaq; Precious Metals Scale New Peaks
China posts record surplus on diversified trade flows
China's efforts to offset its US trading exposure proved prescient as the latest figures showed a record surplus propelled by growing exports to Africa, Latin America, Southeast Asia, and Europe. The export boom has masked oversupply and weak domestic demand.
AP:
China's trade surplus surges 20% to a record $1.2 trillion, even with Trump's tariffs
Reuters:
China's trade ends 2025 with record $1.2 trillion surplus despite Trump tariff jolt
WSJ:
China's Record Trade Surplus Defies Expectations for Tariff-Driven Slowdown
Around the World
Japan plans elections while boosting ties with South Korea, Philippines
Japanese Prime Minister Sanae Takaichi planned snap elections to capitalize on her recent popularity and retake control of the lower house of the Diet with a fresh mandate to pursue fiscal expansion and bolster the nation's defenses.
On Tuesday, Takaichi met with South Korean President Lee Jae Myung as the two countries sought to balance China's regional influence.
On Wednesday, Japan signed a bilateral agreement with the Philippines to coordinate logistics and other assistance in the increasingly contested western Pacific.
AP:
Leaders of South Korea and Japan agree to improve cooperation (1/13)
Japan's Takaichi plans to dissolve lower house to set up an early snap election
Reuters:
Japan PM readies snap election, February 8 ballot eyed
Yen steadies as traders gird for election, intervention fears lurk
Bloomberg:
Japan, Philippines Step Up Defense Ties Amid China Tensions
US announces second phase of peace agreement in Gaza
Envoy and 'Board of Peace' member Steve Witkoff announced that a US-brokered ceasefire accord in Gaza would proceed to its second phase. The latter includes the establishment of a technocratic caretaker government (to be led by Ali Shaath), disarmament, and the beginning of rebuilding efforts.
AP:
Gaza is entering the second phase of the ceasefire plan Trump helped broker, US says
Reuters:
US launches Gaza plan's second phase, forms Palestinian committee
WSJ:
U.S. to Unveil Gaza Governance Plan Despite Concerns Over Hamas
US approves restricted Nvidia chip sales to China
The US granted export licenses to Nvidia to sell advanced H200 chips to China, subject to certain conditions. The decision raised concerns about the security implications of giving additional compute and sensitive technology to a strategic competitor in the midst of an AI arms race.
AP:
Sales of a powerful Nvidia AI chip to China gets the green light, with conditions
Reuters:
Trump's green light for Nvidia AI chips to China draws fire from lawmakers, former officials
WSJ:
Trump Administration Enacts Security Rules for Nvidia's China Chip Sales (1/13)
UAE joins US-led secure supply chain initiative
The United Arab Emirates joined 'Pax Silica', a US program to boost industrial capacity, reduce external dependencies, and enhance supply chain security for critical resources. The UAE joins Australia, UK, Israel, Japan, Qatar, Singapore, and South Korea (Reuters).
Reuters:
Qatar and UAE to join U.S.-led effort to bolster technology supply chain (1/11)
UAE bolsters economic ties with US by joining AI supply chain program
EU outlines lending to Ukraine
According to European Commission President Ursula von der Leyen, EUR 90bn of loans to Ukraine will be divided between military spending (60bn) and essential government services (30bn).
The funds, which still require approval from European Parliament and EU member states, would need only be repaid upon the end of the war and receipt of compensation from Russia.
AP:
EU targets Ukraine's military needs with massive new loan program plus billions in budget support
WSJ:
European Defense Companies in Line to Benefit From Bulk of EU's $105 Billion Ukraine Loan
Europe bolsters tech cooperation
Germany's Interior Ministry spoke to an agreement signed over the weekend with Israeli Prime Minister Netanyahu pledging to collaborate on cybersecurity, AI, and related defense initiatives.
Meanwhile, UK and European regulators agreed to tighten cross-border monitoring of technology firms that underpin regional financial services activity.
Reuters:
German-Israel deal strengthens cyber defense, German minister says
UK regulators agree deal to coordinate with EU on critical tech providers
Odds & Ends
US pauses certain visa processing for 75 countries
Under the pretext of deterring immigrants' usage of public benefits, the State Department announced the suspension of visas for a host of countries, effective January 21. The directive will not apply to temporary visas used for tourism and business.
AP:
US will suspend immigrant visa processing from 75 countries over public assistance concerns
Reuters:
US to suspend immigration visa processing for 75 nations
Bloomberg:
US Will Halt Issuing Immigrant Visas for Dozens of Countries
WSJ:
State Department to Pause Visa Processing for 75 Countries
Appeals court upholds California redistricting
In a 2-1 ruling, a federal appeals court in California upheld a partisan redistricting effort approved via referendum in 2025. The decision will almost certainly be appealed to the Supreme Court.
Comment: Numerous state gerrymandering efforts will come before the courts ahead of the 2026 midterms, with control of the House at stake.
AP:
Federal judges allow California to use new US House map ahead of 2026 election
Central banks experiment with digital payments processing
Led by the Bank for International Settlements (BIS) with participation from major central banks and financial institutions, the Agora project announced that it would proceed to a testing phase. The project seeks to leverage tokenization to facilitate and improve the execution of international transactions.
Reuters:
Top central banks forge ahead with closely watched cross-border payments testing
US crypto legislation goes back to the drawing board
The Senate Banking Committee delayed a vote to advance its version of legislation that would establish baseline regulations for cryptocurrencies in the US.
Reuters:
Coinbase cannot support crypto bill in current form, CEO Armstrong says
WSJ:
Banks and Crypto Clash Over Tokens That Pay More Than Deposits