Crypto News: Worried Americans

US consumer confidence suddenly dropped in January to a four-month low thanks in part to renewed pessimism about the labor market and the outlook for the broader economy. Complaints that jobs are harder to get are up while expectations that wages will rise are down—as is the number of people saying business conditions are good.

Sure, inflation continues to ease and employment still looks great on paper. But as the Democrats discovered in November, that isn't how it feels on the ground. Jobseekers say it's taking longer to find work as doubts about making ends meet persist. While Donald Trump rode that disconnect to victory over Kamala Harris, it's now become his liability as everyday Americans worry the 78-year-old's scattershot tariff threats could make things worse.

The share of consumers that said jobs were currently plentiful fell this month to the lowest since September, and a larger net share said jobs were hard to get. The difference between these two—a metric closely followed by economists to gauge the job market—narrowed by the most since April. "The return of pessimism about future employment prospects seen in December was confirmed in January," proclaimed Dana Peterson, chief economist at The Conference Board.

At the same time, the environment for buying big-ticket items such as cars, houses and appliances also has gotten worse, which likely reflects still-elevated prices as well as high borrowing costs. Put that all together, and you have a Federal Reserve that's widely expected to hold interest rates steady. — Jordan Parker Erb

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Still, that doesn't mean Fed Chair Jerome Powell won't be top of mind tomorrow. While investors have accepted that the central bank probably won't cut interest rates this time around, they'll be looking for any signal from the chair on where inflation is going. With the stock market at a tenuous point (particularly after yesterday's DeepSeek-sparked AI jolt), Wall Street veterans will be listening for anything that indicates his thinking—though it'd be unlike him to be anything other than cautious and noncommittal. But given that his smooth landing for the post-pandemic economy has now been thrown into question, every little crumb will be happily consumed.

The Bank of Canada is also set to make a decision on interest rates tomorrow. Markets and economists widely expect policymakers led by Governor Tiff Macklem to cut the policy interest rate by a quarter percentage point. The cut would bring rates down to 3%, the lowest since September 2022. Trump's repeated tariff threats—which with the exception of a 24-hour tiff with Colombia remain unfulfilled—are clouding the outlook. But the central bank has said it doesn't set interest rates on the basis of policies that aren't yet clear.

Tiff Macklem, governor of the Bank of Canada Photographer: David Kawai/Bloomberg

Trump triggered yet another executive order firestorm, this time by directing a freeze on federal grants and loans. Condemned by Democrats and others as another illegal power grab, it's already been temporarily halted in part by a federal judge. Russell Vought, Trump's acting budget director and an author of the far-right Project 2025 (which Trump claimed he wasn't familiar with) issued a memo Monday telling agencies to pause all federal financial assistance in order to review if the spending complies with Trump's other orders. The directive however is seen as illegal given it contradicts a 50-year-old law that allows the executive branch to pause funding only under certain conditions and after notifying Congress (which under the US Constitution has the power of the purse). A coalition of nonprofits filed a lawsuit Tuesday seeking to immediately block the order. In total, the directive threatens more than $1 trillion in funding to local governments, putting everything from transit infrastructure to housing projects at risk. But before this latest setback for the administration could get media traction, Trump issued another dramatic order: proposed buyouts for federal workers.

HSBC is planning to wind down some of its investment banking operations in Europe, the UK and the Americas. The lender will no longer provide equity underwriting and advisory services outside of its core operations in Asia and the Middle East, but will complete any live deals and mandates. It's the latest in Chief Executive Officer Georges Elhedery's sweeping restructuring of the bank. With his new move, he is taking the axe to a part of his business that has long faced scrutiny from investors because of its struggle to gain market share over the years. While HSBC is one of the largest lenders in the West, it lacks the scale in New York, London or continental Europe to compete against Wall Street giants.

UK Netflix subscribers may have to pay a fee to help fund the BBC. In an effort to modernize funding for the public broadcaster, the British government is considering having streaming-service subscribers pay for the broadcaster's license fee. The government has been weighing how to overhaul funding when its current 11-year charter ends in 2027. Others options include advertising, taxing streaming services and asking BBC radio listeners to pay a fee. The talks are sensitive because the UK's national broadcaster is often viewed as a key vehicle for the country's remaining soft power around the world.

Just in case you're taking the risk of a US invasion of Greenland seriously, its people are overwhelmingly against it. A new poll showed 85% of the population on the self-ruling Arctic territory don't want to part from Denmark, let alone be a part of the US. Trump (as is well known by now) has repeatedly mused about claiming the world's largest island for a variety of reasons. Danish Prime Minister Mette Frederiksen, meanwhile, is intent on pushing back on all this annexation talk. Frederiksen has met with German Chancellor Olaf Scholz in Berlin and French President Emmanuel Macron, seeking to coordinate support from European allies.