The Japanese yen depreciated past 156 per dollar on Wednesday, sliding for the fourth straight session to a near two-week low ahead of this weekend’s snap lower house election. Prime Minister Sanae Takaichi’s ruling LDP is expected to gain more seats in the national election as she seeks voter backing for increased spending, tax cuts and a new security strategy. Japanese bonds and the yen have come under pressure since Takaichi’s election as she pushes for expansionary fiscal policies, raising concerns about Japan’s fiscal outlook on fears of debt-funded spending. Takaichi also said over the weekend that a weak yen could be an opportunity for export industries, before walking back those comments, clarifying that her remarks were intended to promote an economy resilient to currency swings. The yen had rallied as much as 4.5% in late January on speculation of a US-Japan joint currency intervention but has since retraced more than half of those gains.

Gold climbed back above the key $5,000 per ounce level on Wednesday, building on a more than 6% surge in the previous session, the biggest daily gain since 2008, as dip buyers stepped in following a sharp pullback earlier in the week. Geopolitical tensions also lifted the metal’s safe-haven appeal after US forces downed an Iranian drone near an aircraft carrier in the Arabian Sea, although President Donald Trump said diplomacy remains active, with the White House confirming US-Iran talks are still scheduled for Friday. Meanwhile, expectations for rapid Federal Reserve rate cuts eased after Trump nominated Kevin Warsh as Fed chair, though markets still price in two cuts this year, likely around mid-year and later in 2026. Separately, key US labor data, including JOLTS and the monthly jobs report, will be delayed by the partial government shutdown, while House Republicans are set to vote Tuesday on a Senate-approved funding package.

WTI crude oil futures climbed toward $64 per barrel on Wednesday, extending gains from the previous session as geopolitical tensions resurfaced after the US downed an Iranian drone near a US aircraft carrier in the Arabian Sea. The incident unsettled energy markets, though President Donald Trump emphasized that diplomatic channels remain open, with the White House confirming US-Iran talks are still scheduled for Friday. Adding to tensions, Iranian vessels challenged a US-flagged oil tanker transiting the Strait of Hormuz, with US Central Command saying the IRGC harassed the Stena Imperative. Further support came from API data showing US crude inventories fell by 11.1 million barrels last week, the largest draw since June if confirmed by official figures. Meanwhile, OPEC+ expects oil demand to gradually pick up from March or April and will decide on March 1 whether to resume monthly output increases after a first-quarter pause.

Bitcoin dropped to as low as $72,800 in early February, hitting its lowest levels since November 2024 as forced liquidations of leveraged positions intensified and fund outflows accelerated. Industry data showed that nearly 170k leveraged traders were washed out during the selloff, with more than $730 million liquidated over the past 24 hours. Bitwise CIO Matt Hougan said bitcoin has been in a multi-month bear market, arguing that strong institutional adoption and greater regulatory clarity have left investors complacent. Meanwhile, global crypto funds recorded another $1.7 billion in net outflows last week, led by US-listed products, while assets under management have fallen by $73 billion since peaking in October 2025. In other developments, investor Michael Burry warned that bitcoin’s roughly 40% plunge could deepen and inflict lasting damage on companies that have accumulated large holdings over the past year.

The Ai Group Australian Industry Index edged up 0.2 points to -12.3 seasonally adjusted in December/January. The indicator has continued to recover through 2025, but activity remains mixed. Domestic demand remained subdued amid seasonal challenges, while economic uncertainty, rising input costs, regulatory pressures and labour shortages continued to weigh on activity, partly offset by stronger construction inquiries and improved conditions in metals and food industries. The employment index was broadly stable at -4.7, reflecting ongoing difficulties in securing suitable staff, with some firms scaling back operations and others holding vacancies amid persistent skill shortages. New orders improved in December/January, rising 4.1 points to -14.2 as the 2026 work pipeline began to flow through, while input volumes fell slightly to -15.7, contracting at a similar pace to November. Pricing indicators eased modestly, with both input and sales prices declining, while wages remained elevated.

New Zealand's seasonally adjusted unemployment rate edged up to 5.4% in the December 2025 quarter, higher than both the previous figure and market expectations of 5.3%. This was the highest jobless rate since the September 2015 quarter, as the number of unemployed individuals rose by 5,000 from the prior quarter to 165,000. At the same time, employment rose marginally during the quarter. The labour force participation rate also rose to 70.5% from 70.3%, signaling a modest increase in workforce engagement. The underutilisation rate, a broader measure of spare labour capacity, stood at 13.0% and was well above the 12.2% level a year earlier. These figures pointed to higher engagement in the labour market amid mixed signals on slack, suggesting a tentative improvement in conditions.