Daily Update:

• BLS data showed that labour productivity (output per hour of a nonfarm employee) increased at an annualised rate of 1.2% in Q4, with Q3 productivity being revised up slightly. Between 2023 and 2024, the annual rate of productivity increased by 2.3%, the largest yearly increase in 14 years (excluding Covid) and significantly higher than the 1.2% average rate in the 2010 era.

• Speaking at a BIS conference, Dallas Fed President Lorie Logan laid out two possible directions for Fed policy in 2025: “in some scenarios it will soon be appropriate to resume reducing” rates and “in other scenarios, we’ll need to hold rates, at least at the current level, for quite some time”. She emphasised that due to the nature of business cycles, inflation can often start the year high, before cooling off – taking the example of higher inflation in early 2023, its cooling in late 2023 and then its resurgence in early 2024. Logan also said even if “inflation comes in close to 2% in coming months” it would be “good news” but “wouldn’t necessarily allow the FOMC to cut rates soon”. 

• President Trump’s Media and Technology Group has trademarked 6 different investment products which would be launched under the President’s Truth.Fi brand. They include a Bitcoin Plus ETF, a Made in America ETF and a U.S. Energy Independence ETF, which would make Mr Trump the first U.S. president to have launched their own ETF. Trump owns a majority stake in his Trump Media company. 
• The news comes as the First Family’s two crypto token launches, $TRUMP and $MELANIA are down 75% and 90% respectively, from their all-time highs.

• In derivatives, BTC’s at-the-money implied vol term structure has continued to steepen, while ETH maintains a more flat structure. The two major’s Spot ETF products are diverging too – BTC Spot ETFs recorded outflows of $140.2M following BlackRock’s large purchases earlier in the week, whereas the ETH products recorded another day of inflows, though more subdued at $10.7M.  

• Ondo Finance has announced the development of Ondo Chain, their new Layer 1 blockchain designed for an accelerated issuance of tokenised RWAs. 

• Nigeria’s government approved stablecoin, cNGN, is now live on specific Nigeria- regulated exchanges, including Busha and Quidax.

This Week’s Calendar:

Charts Of The Day: