Global Stocks Edge Higher on Fed Policy Shift; Gold Surges Amid U.S. Tariffs on Bullion Imports

Global stock markets nudged higher on Friday as investors grew optimistic about potential interest rate cuts by the U.S. Federal Reserve, following recent leadership changes and dovish signals from policymakers. The MSCI All-Country index hovered near record highs, supported by strong European earnings and optimism that new U.S. tariffs might be renegotiated. Meanwhile, U.S. stock futures showed modest gains, reflecting cautious investor sentiment.

A key driver behind the market rally is the nomination of Stephen Miran, the White House Council of Economic Advisers Chairman, to a temporary seat on the Federal Reserve board. Miran’s views align closely with President Donald Trump’s criticisms of Fed Chair Jerome Powell, particularly regarding the timing of interest rate cuts. This appointment fuels expectations that the Fed will pursue rate reductions before year-end, which has buoyed global markets.

In Asia, Japan’s stock indices posted significant gains, with the Nikkei 225 rising 2% and the Topix hitting record levels. Investors are also digesting reports that Fed Governor Christopher Waller may succeed Powell when his term expires in May 2026, signaling continued shifts in U.S. monetary policy leadership. These developments underline growing market anticipation of a more accommodative Fed stance in the near term.

Gold prices surged sharply, hitting new record highs after news broke of U.S. tariffs imposed on 1-kilogram gold bars, largely imported from Switzerland. Spot gold edged up slightly, while futures spiked over 2%, reflecting safe-haven demand amid rising trade tensions. The tariffs mark a significant escalation in U.S.-Swiss trade friction and have added a fresh dynamic to commodity markets.

Despite the upbeat sentiment in equities and gold, bond markets showed signs of strain with weak demand for long-term U.S. Treasury bonds, pushing yields slightly higher. Currency markets were mixed, with the dollar strengthening modestly against the yen but retreating slightly against the euro. Meanwhile, Tokyo’s trade negotiator confirmed ongoing U.S. efforts to avoid overlapping tariffs on Japanese products, highlighting the complexities of current global trade relations.

Source: Reuters