Weekly house view | Donroe Doctrine
The week in review
The year 2025 proved positive for investors in equities, with the MSCI All Countries Index1 (in USD) closing the year 22.9% higher on a total return basis. Tariffs, geopolitical tensions and fiscal worries were major themes and allowed precious metals to perform very strongly. Gold, silver and platinum rose by 65%, 147% and 125% respectively over the year. The rise saw an ounce of silver buy more than a barrel of oil for the first time since 1975.
Last week, silver fell after the Chicago Mercantile Exchange hiked the margins on precious metal futures. However, precious metals are clear winners from the situation in Venezuela, where US forces captured President Nicolás Maduro on Saturday. US President Donald Trump justified the operation by invoking what he referred to as “the Donroe Doctrine” – an updated version of the Monroe Doctrine, which asserts US dominance in the region. Trump said he was putting Venezuela under temporary US control. The situation remains fluid and the implications for asset classes depend on the US achieving its objectives from the newly formed Venezuelan government. Venezuela has the world's largest proven oil reserves, but its crude output remains a fraction of capacity due to crumbling infrastructure.
On another geopolitical risk area, Ukraine, Trump said he and Ukrainian President Volodymyr Zelenskyy were a lot closer to a peace deal, but that“thorny issues” remain.
Geopolitics
Trump warned on Sunday of a “second strike” if Venezuela's acting President, Delcy Rodríguez, does not cooperate. Rodríguez declared that Venezuela “will not be anyone’s colony”. Trump said she was “co-operating.” Underscoring rising geopolitical risks, several people were killed as protests in Iran turned violent.
Key data
In China, the official manufacturing PMI came in above expectations, rebounding to 50.1 in December from 49.2 in November. The official non-manufacturing PMI also recovered to 50.2 in December from 49.2 in November
