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Odds of a government shutdown surge to 80%. (00:14) Carney says Canada has no plans to pursue a free-trade deal with China as Trump threatens 100% tariffs. (02:06) Gold tops $5,000 per ounce. (02:58)
This is an abridged transcript.
The odds of a government shutdown are higher this morning.
Odds shot up on prediction markets after Senate Democrats vowed to block a $1.2T funding package that includes appropriations for the Department of Homeland Security.
U.S. Immigration and Customs Enforcement falls under the purview of DHS.
Odds of a government shutdown by January 31 surged to 79% on Kalshi, up from 11.5% on Friday. On Polymarket, the odds jumped to 80% from 9%.
The standoff intensified after federal immigration agents shot and killed Alex Pretti in Minneapolis on Saturday.
Pretti was a 37-year-old ICU nurse and a U.S. citizen. This is the second such incident this month. The shooting has galvanized Democratic opposition to the funding measure.
Senate Minority Leader Chuck Schumer said in a statement Saturday night that “Senate Democrats will not provide the votes to proceed to the appropriations bill if the DHS funding bill is included.”
The package needs 60 votes to overcome the filibuster. Republicans hold a 53-47 majority. However, several key swing votes have now turned against the bill.
A massive snowstorm has further complicated matters, forcing the Senate to cancel Monday votes and shortening an already tight timeline to avert the shutdown.
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Canadian Prime Minister Mark Carney has clarified the country’s position on a potential trade agreement with China.
Carney said Canada has “no intention” of pursuing a free-trade agreement with China. He added that Canada has addressed some of the issues that emerged over the past few years and, in many respects, is moving “back to the future” across sectors such as EVs, agriculture, fish, and other food products—but with stronger safeguards in place.
The prime minister further said Canada respects its obligations under the Canada-U.S.-Mexico Agreement and will not pursue a free-trade deal without notifying the other two parties.
The statement to reporters on Sunday comes after President Trump wrote in a Truth Social post on Saturday that, “If Canada makes a deal with China, it will immediately be hit with a 100% Tariff.”
Gold is above $5,000 an ounce and reached that mark for the first time on Sunday.
Spot gold (XAUUSD:CUR) is up 2.1% to $5,095, building on an 8.5% gain last week. A weaker dollar (DXY) reinforced demand, with the Bloomberg Dollar Spot Index falling 1.6% for its biggest weekly decline since May, making precious metals more affordable for most buyers. Silver (XAGUSD:CUR) (SLV) also hit a record high, up 6.5% to $109.
Max Belmont, portfolio manager at First Eagle Investment Management, told Bloomberg, “Gold is the inverse of confidence. It’s a hedge against unexpected bouts of inflation, unanticipated drawdowns in the market, flare-ups in geopolitical risk.”
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