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Japanese Prime Minister Sanae Takaichi called on South Korean President Lee Jae Myung Tuesday to help “ensure regional stability”, as Beijing pressures Tokyo over its stance on Taiwan.The two leaders met in Takaichi’s picturesque home region of Nara in western Japan, days after Lee visited Chinese leader Xi Jinping in Beijing.They agreed to strengthen cooperation on economic security, regional and global issues, as well as artificial intelligence, according to South Korea’s presidential office.Looming in the background of the meeting was Japan’s heated diplomatic spat with China, triggered by Takaichi’s suggestion in November that Japan could intervene militarily if China attacks Taiwan.China, which regards Taiwan as its own territory, reacted angrily, blocking exports to Japan of “dual-use” items with potential military applications, fuelling worries in Japan that Beijing could choke supplies of much-needed rare earths.Takaichi said she told Lee that “while advancing Japan-South Korea relations, both countries should cooperate to ensure regional stability and fulfill their respective roles”.”As the environment surrounding both of our countries becomes ever more severe, our bilateral relations, as well as the cooperation among Japan, South Korea and the United States, are assuming greater importance,” she later told a news conference.At the beginning of his meeting with Takaichi, Lee said that cooperation between the two US allies “is more important than ever”.”In this increasingly complex situation and within this rapidly changing international order, we must continue to make progress toward a better future,” Lee added.They agreed to continue their “shuttle diplomacy” of regular meetings, according to Takaichi, as well as work towards the complete denuclearisation of North Korea.Lee and Takaichi, who both took office in 2025, last met in October on the sidelines of the APEC regional summit in Gyeongju, South Korea.It is Lee’s second visit to Japan since August, when he met Takaichi’s predecessor Shigeru Ishiba.- Bitter memories -Lee and Takaichi will have dinner Tuesday, before visiting one of Japan’s oldest temples in Nara on Wednesday.”Behind closed doors, the leaders will certainly discuss the current Japan-China crisis, as Beijing’s retaliatory measures, including export controls, will have an impact on Korea as well,” Benoit Hardy-Chartrand, an East Asian geopolitics expert at Temple University’s Tokyo campus told AFP, with the supply chains of the three nations deeply intertwined.Lee said in an interview with Japanese public broadcaster NHK aired on Monday that it was not his place to “intervene or get involved” in the Japan-China row.”From the standpoint of peace and stability in Northeast Asia, confrontation between China and Japan is undesirable,” he said. “We can only wait for China and Japan to resolve matters amicably through dialogue.”Hardy-Chartrand said he believed “the South Korean government felt that it was necessary for President Lee to visit Japan not too long after going to China, in order to demonstrate that Seoul is not favouring one side over the other”.Lee and Takaichi were also expected to discuss their relations with the United States because the unpredictable Trump “has put in doubt old certainties and highlighted the importance of strengthening their ties”, he said.On the bilateral front, bitter memories of Japan’s brutal occupation of the Korean peninsula from 1910 to 1945 have cast a long shadow over Tokyo-Seoul ties.Lee’s conservative predecessor Yoon Suk Yeol, who declared martial law in December 2024 and was removed from office, had sought to improve relations with Japan.Lee is also relatively more dovish towards North Korea than was Yoon, and has said that South Korea and Japan are like “neighbours sharing a front yard”.

Asian markets mostly rose on Tuesday with Tokyo closing at a record high on speculation over a snap election, while concerns about Iran pushed oil prices higher.The rallies followed another record finish on Wall Street overnight, where investors shrugged off worries about a US criminal probe of the Federal Reserve central bank.Tokyo’s Nikkei closed 3.1 percent up, driven by anticipation that Prime Minister Sanae Takaichi will capitalise on strong poll numbers by calling an election.Takaichi became Japan’s first woman prime minister in October and her cabinet has an approval rating of around 70 percent.But her ruling bloc only has a slim majority in parliament’s powerful lower house, hindering her ambitious policy agenda.Tokyo’s gains were mirrored by increases in Hong Kong, Sydney, Singapore and Malaysia. Shanghai was down at the close, with Wellington, Mumbai, Bangkok and Manila also in the red.London and Frankfurt were flat at the open, with Paris in the red.Seoul climbed 1.5 percent after South Korean chip giant SK hynix said it would spend 19 trillion won ($12.9 billion) building an advanced chip packaging plant, as the firm rides the global AI boom.It came after New York’s Dow and S&P 500 ended at records for a second straight day.The tech-rich Nasdaq index also bounced back from early losses after Sunday night’s disclosure of the US Department of Justice probe into the Federal Reserve.Broad optimism over the global economy and technological advances such as artificial intelligence have buoyed market sentiment in recent months.Oil prices rose after US President Donald Trump announced a 25 percent tariff on any country trading with Iran, ramping up pressure on Tehran over its violent crackdown on a wave of protests.Michael Wan at MUFG noted that Iran makes up three percent of global oil production, with Venezuela supplying around one percent “as a rough rule of thumb”.”China stands out as the top trading partner for Iran, both across exports and imports, and also in terms of its position as the top importer of Iranian crude oil,” he said.Trump said in a social media post on Monday that the new levies would “immediately” hit the Islamic republic’s trading partners who also do business with the United States.Taipei was up 0.5 percent after the democratic island said it had reached a “general consensus” with Washington on a trade deal, following months of talks.Taiwan and the United States began negotiations in April to hash out a trade deal after Trump slapped a 32 percent tariff on Taiwanese exports, which was later lowered to 20 percent, as part of his sweep of measures against dozens of trade partners.- Key figures at around 0815 GMT -Hong Kong – Hang Seng Index: UP 0.9 percent at 26,848.47 (close)Shanghai – Composite: DOWN 0.6 percent at 4,138.76 (close)Tokyo – Nikkei 225: UP 3.1 percent at 53,549.16 (close)West Texas Intermediate: UP 0.5 percent at $59.81 per barrelBrent North Sea Crude: UP 0.5 percent at $64.18 per barrelEuro/dollar: DOWN at $1.1658 from $1.1666 on MondayPound/dollar: UP at $1.3468 from $1.3466Dollar/yen: UP at 158.86 yen from 158.17 yenEuro/pound: DOWN at 86.56 pence from 86.63 penceLondon – FTSE 100: FLAT at 10,140.70New York – Dow: UP 0.2 percent at 49,590.20 (close)

Japanese Prime Minister Sanae Takaichi met with South Korea’s President Lee Jae Myung for talks on Tuesday aimed at demonstrating their cordial ties as Beijing pressures Tokyo over its stance on Taiwan.The two leaders are in Takaichi’s picturesque home region of Nara in western Japan, days after Lee visited Chinese leader Xi Jinping in Beijing.Looming in the background is Japan’s heated diplomatic spat with China, triggered by Takaichi’s suggestion in November that Japan could intervene militarily if China attacks Taiwan.China, which regards Taiwan as its own territory, reacted angrily, blocking exports to Japan of “dual-use” items with potential military applications, fuelling worries in Japan that Beijing could choke supplies of much-needed rare earths.”In this increasingly complex situation and within this rapidly changing international order, we must continue to make progress toward a better future,” Lee said at the beginning of the meeting with Takaichi.”Therefore, cooperation between our two countries is more important than ever”.Takaichi said she told Lee that that “while advancing Japan-South Korea relations, both countries should cooperate to ensure regional stability and fulfill their respective roles”.The two US allies have already agreed to strengthen cooperation on economic security, regional and global issues, and artificial intelligence, according to South Korea’s presidential office.They are also expected to compare notes on Washington after President Donald Trump’s unpredictable tariffs and “America First” approach, analysts said.Tense regional geopolitics could provide Takaichi and Lee “further impetus for wanting to build stronger relations”, said Benoit Hardy-Chartrand, an East Asian geopolitics expert at Temple University’s Tokyo campus.Lee and Takaichi, who both took office in 2025, last met in October on the sidelines of the APEC regional summit in Gyeongju in South Korea.It is Lee’s second visit to Japan since August, when he met Takaichi’s predecessor Shigeru Ishiba.After the summit meeting, Lee and Takaichi will have dinner Tuesday to discuss regional and global issues.”Behind closed doors, the leaders will certainly discuss the current Japan-China crisis, as Beijing’s retaliatory measures, including export controls, will have an impact on Korea as well,” Hardy-Chartrand told AFP, with the supply chains of the three nations deeply intertwined.Lee said in an interview with Japanese public broadcaster NHK aired on Monday that it was not his place to “intervene or get involved” in the Japan-China row.”From the standpoint of peace and stability in Northeast Asia, confrontation between China and Japan is undesirable,” he said. “We can only wait for China and Japan to resolve matters amicably through dialogue.”- Bitter memories -Hardy-Chartrand said he believed “the South Korean government felt that it was necessary for President Lee to visit Japan not too long after going to China, in order to demonstrate that Seoul is not favouring one side over the other”.Lee and Takaichi are also expected to discuss their relations with the United States because the unpredictable Trump “has put in doubt old certainties and highlighted the importance of strengthening their ties”, he said.Yee Kuang Heng, a professor in international security at the University of Tokyo, did not expect Lee to bring any particular message from Xi to Takaichi.”However, the two leaders may discuss the fallout from China’s economic coercion that both ROK (South Korea) and Japan have experienced over the years,” Heng told AFP.”Takaichi will be wary of China’s wedge strategy designed to drive divisions between ROK and Japan and will want to re-emphasise common ground shared between Seoul and Tokyo.”On the bilateral front, bitter memories of Japan’s brutal occupation of the Korean peninsula from 1910 to 1945 have cast a long shadow over Tokyo-Seoul ties.Lee’s conservative predecessor Yoon Suk Yeol, who declared martial law in December 2024 and was removed from office, had sought to improve relations with Japan.Lee is also relatively more dovish towards North Korea than was Yoon, and has said that South Korea and Japan are like “neighbours sharing a front yard”.

President Donald Trump said Monday that the United States would be “screwed” if the Supreme Court rules that some of his tariffs are illegal.Trump, in a post on Truth Social, said hundreds of billions of dollars would have to be paid back to US companies if the top court rules against his flagship economic policy.”And that doesn’t include the amount of ‘payback’ that Countries and Companies would require for the investments they are making… for the purpose of being able to avoid the payment of Tariffs,” he said.”When these Investments are added, we are talking about Trillions of Dollars!” he said. “It would be a complete mess, and almost impossible for our Country to pay.””In other words, if the Supreme Court rules against the United States of America on this National Security bonanza, WE’RE SCREWED!” Trump said.The Supreme Court plans to release opinions on Wednesday and the tariffs case, which was argued in November, could potentially be among the rulings it hands down.During oral arguments in the case, the justices appeared deeply skeptical of Trump’s use of emergency powers to impose “reciprocal” tariffs on nearly every US trade partner and levies targeting Mexico, Canada and China over their alleged roles in illicit drug flows.Several of the six conservative justices, along with the three liberals, questioned whether the International Emergency Economic Powers Act (IEEPA) that Trump invoked confers the authority to impose tariffs.The court’s decision does not concern sector-specific tariffs Trump separately imposed, including on steel, aluminum and automobiles.Trump has brought the average effective US tariff rate to its highest since the 1930s, and has repeatedly warned of calamity if the duties are overturned.

India and Germany are looking to boost defence industry cooperation, Prime Minister Narendra Modi said Monday after hosting Chancellor Friedrich Merz in his home state of Gujarat.Merz said Berlin also wants a closer security partnership with New Delhi, including deeper “cooperation between our defence industries” to cut India’s traditional dependence on Russia for military hardware.Merz began his two-day India visit — his first to Asia since taking office in May — two weeks ahead of an EU-India summit and as India and the European bloc are working on a free trade agreement.Both countries announced several agreements and joint declarations after the leaders’ meeting with an aim to boost their $50 billion trade.The announcements included strengthening defence industry cooperation and on semiconductors and critical minerals.The two countries “are working together on secure, trusted, and resilient supply chains and our MoUs on these issues will strengthen our partnership”, Modi said. The meeting between the Indian and German leaders comes at a time when both are facing economic and security challenges from the world’s two biggest economies, China and the United States.Merz said Berlin was “committed to an international order in which we can live freely and securely, because the world is currently undergoing a process of realignment”.”It is increasingly characterised by great power politics and thinking in terms of spheres of influence, which is why we must join forces to weather these rough winds,” he added.”That is why we also want to move closer together in terms of security policy, such as conducting joint exercises between our air forces and navies for security in the Indo-Pacific.”Recent actions and statements by US President Donald Trump including arbitrary trade tariffs have played a key role in upending global alliances and regional geopolitics, with New Delhi still negotiating a trade deal with Washington.- ‘Strategic importance’ -“It is of particular strategic importance that we deepen cooperation between our defence industries. This strengthens both sides and also helps to make India less dependent on Russia, for example,” said Merz.New Delhi, which has relied on Moscow for decades for its key military hardware, has tried to cut its dependence on Russia in recent years by diversifying imports and pushing its own domestic manufacturing base.India today counts France, Israel and the United States as its key military suppliers besides Russia.Berlin and New Delhi have also been negotiating a potential deal for Germany’s Thyssenkrupp Marine Systems to build six submarines for the Indian Navy in partnership with Indian state-run Mazagon Dock Shipbuilders.While still being negotiated, that deal would allow India to replace its ageing fleet of Russian-built submarines and likely include technology transfer provisions to help its domestic defence industry.In defence, the two sides are also exploring other areas of convergence as New Delhi pumps billions of dollars to upgrade its naval fleet and air force in the next few years.There are around 300,000 Indians and people of Indian origin in Germany, including about 60,000 students — many of them in critical science, engineering and other key technology research fields. Many Indian workers have filled a recent shortfall of qualified professionals in Germany’s IT, banking and finance sectors.Modi said that “India is honoured that he (Merz) has chosen our nation as the place of his first visit in Asia”. He said the leaders had agreed on “deeper cooperation in defence, space and other critical and emerging technologies”. Merz will wrap up his visit with a trip to the southern technology hub of Bengaluru on Tuesday.

The dollar weakened and gold hit a record high Monday as investors digested news that the US Justice Department is probing the Federal Reserve, raising fears over the central bank’s independence against President Donald Trump’s push for lower rates.European stocks wavered after a strong showing in Asia, seen on the back of solid gains on Wall Street before the weekend. Fed Chair Jerome Powell confirmed the “unprecedented” subpoenas against the bank in a rare video address on Sunday, which he blasted as part of Trump’s pressure campaign for aggressive rate cuts.”The probe has unnerved markets and raised questions about what might happen to the Fed once Powell steps down in May,” said Russ Mould, investment director at AJ Bell.  “There is a fear that Trump is meddling too much with policies that are meant to be set independently,” he added.Gold climbed close to $4,600 an ounce while silver approached $85 an ounce as investors sought traditional safe havens. The dollar fell against major peers, as did the price of the benchmark 10-year US Treasury bond, sending its yield slightly higher.”The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president,” Powell said in his statement.He said the bank received grand jury subpoenas on Friday related to his Senate testimony in June, which had been in part about a major renovation of Federal Reserve office buildings.The Fed has indicated it will hold interest rates steady at its next monetary policy meeting this month.The development came on the heels of Friday’s soft US jobs report that showed just 50,000 new positions in December, though the unemployment rate slipped to 4.4 percent.Asian markets advanced Monday, led by gains in Hong Kong and Shanghai and tracking Wall Street’s record close at the end of last week. Tokyo was closed for a holiday.Most stock markets have enjoyed a solid start to 2026, with indices in Frankfurt, London, Paris and Seoul hitting record highs last week, largely on optimism for the tech sector and gains in defence sector shares.Oil prices fell in volatile trading Monday as protests in Iran and the US seizure of Venezuela’s crude supplies stoke geopolitical risks.Trump said Sunday that he was considering military action against Iran following reports of hundreds of deaths during a violent crackdown on the protesters.”We’re looking at it very seriously,” Trump told reporters on Air Force One. “The military is looking at it, and we’re looking at some very strong options.”- Key figures at around 1100 GMT -London – FTSE 100: FLAT at 10,123.39 pointsParis – CAC 40: DOWN 0.2 percent at 8,342.00Frankfurt – DAX: UP 0.2 percent at 25,309.51Hong Kong – Hang Seng Index: UP 1.3 percent at 26,608.48 (close)Shanghai – Composite: UP 1.1 percent at 4,165.29 (close)Tokyo – Nikkei 225: (closed for holiday)New York – Dow: UP 0.5 percent at 49,504.07 points (close)Euro/dollar: UP at $1.1687 from $1.1635 on FridayPound/dollar: UP at $1.3470 from $1.3407Dollar/yen: DOWN at 157.85 yen from 157.88 yenEuro/pound: DOWN at 86.76 pence from 86.78 penceBrent North Sea Crude: DOWN 0.6 at $62.99 per barrelWest Texas Intermediate: DOWN 0.7 percent at $58.72 per barrel

India and Germany are looking to boost defence industry cooperation, Prime Minister Narendra Modi said Monday after hosting Chancellor Friedrich Merz in his home state of Gujarat.Merz said Berlin also wants a closer security partnership with New Delhi, including deeper “cooperation between our defence industries” to cut India’s traditional dependence on Russia for military hardware.Merz began his two-day India visit — his first to Asia since taking office in May — two weeks ahead of an EU-India summit and as India and the European bloc are working on a free trade agreement.Both countries announced several agreements and joint declarations after the leaders’ meeting with an aim to boost their $50 billion trade.The announcements included strengthening defence industry cooperation and on semiconductors and critical minerals.The two countries “are working together on secure, trusted, and resilient supply chains and our MoUs on these issues will strengthen our partnership”, Modi said. “Closer cooperation in security and defence shows mutual trust and shared views,” Modi added.”We will work on a roadmap to increase defence industrial cooperation, which will open new opportunities for co-development and co-production.”The meeting between the Indian and German leaders comes at a time when both are facing economic and security challenges from the world’s two biggest economies, China and the United States.Merz said Berlin was “committed to an international order in which we can live freely and securely, because the world is currently undergoing a process of realignment”.”It is increasingly characterised by great power politics and thinking in terms of spheres of influence, which is why we must join forces to weather these rough winds,” he added.”That is why we also want to move closer together in terms of security policy, such as conducting joint exercises between our air forces and navies for security in the Indo-Pacific.”Recent actions and statements by US President Donald Trump including arbitrary trade tariffs have played a key role in upending global alliances and regional geopolitics, with New Delhi still negotiating a trade deal with Washington.- ‘Strategic importance’ -“It is of particular strategic importance that we deepen cooperation between our defence industries. This strengthens both sides and also helps to make India less dependent on Russia, for example,” said Merz.New Delhi, which has relied on Moscow for decades for its key military hardware, has tried to cut its dependence on Russia in recent years by diversifying imports and pushing its own domestic manufacturing base.India today counts France, Israel and the United States as its key military suppliers besides Russia.Berlin and New Delhi have also been negotiating a potential deal for Germany’s Thyssenkrupp Marine Systems to build six submarines for the Indian Navy in partnership with Indian state-run Mazagon Dock Shipbuilders.While still being negotiated, that deal would allow India to replace its ageing fleet of Russian-built submarines and likely include technology transfer provisions to help its domestic defence industry.In defence, the two sides are also exploring other areas of convergence as New Delhi pumps billions of dollars to upgrade its naval fleet and air force in the next few years.Merz will wrap up his visit with a trip to the southern technology hub of Bengaluru on Tuesday.

Asian equities gained on Monday and precious metals set records as investors digested news that the US Justice Department is probing the Federal Reserve, raising fears over US central bank independence.Fed Chair Jerome Powell confirmed the “unprecedented” move late on Sunday, which he blasted as part of US President Donald Trump’s pressure campaign for another rate cut.Gold surged 1.6 percent to nearly $4,600 an ounce, while silver approached $85 an ounce — both records — as investors sought safe havens. The dollar fell about 0.2 percent against major peers, according to Bloomberg.”The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell said in a statement.He said the bank received grand jury subpoenas on Friday related to his Senate testimony in June, which had been about a major renovation project of Federal Reserve office buildings.The Fed has indicated that it would hold interest rates steady in its closely watched meeting at the end of this month.”The subpoenas mark a clear break in the long-held boundary between politics and monetary policy, a line markets once assumed was untouchable,” Stephen Innes of SPI Asset Management told AFP.”Investors are not weighing the odds of charges so much as the risk that political pressure has crept into the Fed’s decision-making,” he said.The probe will play into the outlooks for US dollar and Treasuries, Michael Brown of Pepperstone wrote in a comment.”Both the USD and USTs will now have to price a considerably higher risk premium, and hence are likely to face some headwinds in the short-term, and unimaginably brutal selling pressure if this matter were to progress to criminal charges, or a prosecution,” Brown said.The development came on the heels of Friday’s soft US jobs report that showed just 50,000 new positions in December, while unemployment slipped to 4.4 percent.Asian markets were up, led by gains in Hong Kong, Shanghai, Seoul, Taipei and Manila, tracking Wall Street’s record Friday close.Singapore, Kuala Lumpur, Jakarta and Sydney were also in the green, while Mumbai, Bangkok and Wellington dipped.London and Paris opened in the red, while Frankfurt was up.Most stock markets have enjoyed a solid start to 2026, with indices in Frankfurt, London, Paris and Seoul hitting record highs last week, largely on optimism for the tech sector and gains in defence sector shares.Oil prices dipped slightly after gaining during afternoon trade, as protests in Iran and the US seizure of Venezuela’s oil supplies continued to stoke geopolitical risk.The US president has warned Tehran of repercussions if demonstrators were harmed, while Iran cautioned against foreign intervention.Trump said on Sunday evening he was considering potential military action against Iran following reports of a violent crackdown on protests leading to the deaths of hundreds of people.”We’re looking at it very seriously,” Trump told reporters on Air Force One. “The military is looking at it, and we’re looking at some very strong options. We’ll make a determination,” he said.- Key figures at around 0815 GMT -Hong Kong – Hang Seng Index: UP 1.3 percent at 26,608.48 (close)Shanghai – Composite: UP 1.1 percent at 4,165.29 (close)Tokyo – Nikkei 225: (closed for holiday)London – FTSE 100: DOWN 0.3 percent at 10,097.76Euro/dollar: UP at $1.1679 from $1.1635 on FridayPound/dollar: UP at $1.3450 from $1.3407Dollar/yen: DOWN at 157.80 yen from 157.88 yenEuro/pound: UP at 86.83 pence from 86.78 penceWest Texas Intermediate: DOWN 0.3 percent at $58.93 per barrelBrent North Sea Crude: DOWN 0.3 at $63.17 per barrelNew York – Dow: UP 0.5 percent at 49,504.07 points (close)

A Japanese research vessel on Monday began a historic voyage to attempt to dig deep-sea rare earths at a depth of 6,000 metres to curb dependence on China.Scientific drilling boat called the Chikyu left Shimizu Port in Shizuoka around 9:00 am (0000 GMT) for the remote island of Minami Torishima in the Pacific, where surrounding waters are believed to contain a rich trove of valuable minerals.The test cruise comes as China — by far the world’s biggest supplier of rare earths — ramps up pressure on its neighbour after Prime Minister Sanae Takaichi suggested in November that Tokyo could react militarily to an attack on Taiwan.Beijing claims self-ruled Taiwan as part of its territory and has vowed to seize it by force if necessary.China has long used its dominance in rare earths for geopolitical leverage, including in its trade war with US President Donald Trump’s administration.Chikyu’s voyage, delayed by one day due to bad weather, could lead to domestic production of rare earths, said Shoichi Ishii, programme director at the Cabinet Office.”We are considering diversifying our procurement sources and avoiding excessive reliance on specific countries,” he told reporters at the port as the ship prepared to leave.”One approach I believe could be pursued is establishing a process to achieve domestic production of rare earths,” he said.Rare earths — 17 metals difficult to extract from the Earth’s crust — are used in everything from electric vehicles to hard drives, wind turbines and missiles.The Japan Agency for Marine-Earth Science and Technology (JAMSTEC) has touted the test as the world’s first at such depths.The area around Minami Torishima, which is in Japan’s economic waters, is estimated to contain more than 16 million tons of rare earths, which the Nikkei business daily says is the third-largest reserve globally.These rich deposits contain an estimated 730 years’ worth of dysprosium, used in high-strength magnets in phones and electric cars, and 780 years’ worth of yttrium, used in lasers, Nikkei said.”If Japan could successfully extract rare earths around Minami Torishima constantly, it will secure domestic supply chain for key industries,” Takahiro Kamisuna, research associate at The International Institute for Strategic Studies (IISS), told AFP.”Likewise, it will be a key strategic asset for Takaichi’s government to significantly reduce the supply chain dependence on China.”The cruise is scheduled to last until February 14. Recent media reports said Beijing was delaying Japanese imports as well as rare-earth exports to Tokyo, as their two-month-old spat escalates. China this month blocked exports to Japan of “dual-use” items with potential military uses, fuelling worries in Japan that Beijing could choke supplies of rare earths, some of which are included in China’s list of dual-use goods.

Asian equities posted gains Monday while the dollar dipped as investors digested news that the US Justice Department subpoenaed the Federal Reserve, raising fears over US central bank independence.Fed Chair Jerome Powell confirmed the unprecedented move late Sunday, which he blasted as part of US President Donald Trump’s pressure campaign for another rate cut. The Fed has indicated it would hold rates steady.”The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell said in a statement late Sunday.Powell said the bank received grand jury subpoenas on Friday related to his Senate testimony in June, which had been about a major renovation project of Federal Reserve office buildings.It came on the heels of Friday’s soft US jobs report showing just 50,000 new positions in December and unemployment slipping to 4.4 percent.The dollar fell about 0.2 percent against major peers, according to Bloomberg, while gold surged 1.5 percent as investors faced with political uncertainty sought safe havens.Asian markets posted gains in early trade. Hong Kong, Shanghai, Seoul and Taipei climbed, tracking Wall Street’s record close Friday.Bangkok, Manila, Singapore, Kuala Lumpur, and Jakarta were also up.Most stock markets have enjoyed a solid start to the year, with indices in Frankfurt, London, Paris and Seoul hitting record highs last week, largely on optimism for the tech sector and gains in defence sector shares.Oil prices saw a slight dip, but largely held after a rally last week, as protests in Iran continued to stoke geopolitical risk and the US seizure of Venezuela’s crude supplies added to concerns of a supply glut.President Trump has warned Tehran of repercussions if demonstrators were harmed, while Iran cautioned against foreign intervention.On Sunday evening, Trump said he was considering potential military action against Iran following reports of a violent crackdown leading to the deaths of hundreds of people in the country.”They’re starting to, it looks like,” Trump said, when asked by reporters aboard Air Force One if Iran had crossed his previously stated red line of protesters being killed.”We’re looking at it very seriously. The military is looking at it, and we’re looking at some very strong options. We’ll make a determination,” he said.He also said that the Islamic republic’s leadership had called seeking “to negotiate” and that a meeting was being set up.- Key figures at around 0230 GMT -Hong Kong – Hang Seng Index: UP 0.4 percent at 26,327.33Shanghai – Composite: UP 0.4 percent at 4,138.32Tokyo – Nikkei 225: (closed for holiday)West Texas Intermediate: DOWN 0.1 percent at $59.06 per barrelBrent North Sea Crude: FLAT at $63.30 per barrelEuro/dollar: UP at $1.1656 from $1.1635 on FridayPound/dollar: UP at $1.3424 from $1.3407Dollar/yen: FLAT at 157.88 yen from 157.88 yenEuro/pound: UP at 86.83 pence from 86.78 penceLondon – FTSE 100: UP 0.8 percent at 10,124.60 (close)New York – Dow: UP 0.5 percent at 49,504.07 points (close)