Speaking to ET Now, Yardeni said the most immediate reaction to the Venezuela developments was visible in gold, which behaved exactly as expected during geopolitical uncertainty. “Gold reacted as one would expect. A safe-haven rush into gold led to a big increase in the price of gold today, and it continues to be on a solid upward bullish trend,” he noted.
Oil, however, surprised many observers by showing little reaction. “The oil price really did not do much. It did not go down. It went up a little bit,” Yardeni said. Energy stocks, particularly large US energy companies, outperformed. “Presumably, they will have an opportunity to do more of their business in Venezuela and develop that vast oil reserve.”
More telling, he said, was the broader equity market’s lack of a risk-off response. “The overall stock market certainly did not have a safe-haven or risk-off characteristic at all. Energy stocks did well, so did the financials and the industrials,” he explained, adding that this reflected investor confidence that the situation would not spiral into a wider geopolitical crisis.
That confidence, however, may be premature. Yardeni cautioned that Washington’s renewed assertion of influence in the Western Hemisphere could trigger unintended consequences elsewhere. “It will be interesting to see, now that the United States has declared that the Monroe Doctrine is back and that the Western Hemisphere is our sphere of influence. What is to keep the Chinese from saying that, if that is the case, they need to move on Taiwan? And what is to keep Putin from saying that he does not really want to resolve the war and wants all of Ukraine?”
On commodities, Yardeni said muted reactions reflected uncertainty rather than complacency. “Commodity prices have had a very strong run in late 2025,” he told ET Now, pointing to earlier strength in precious metals and late-year rallies in copper, nickel and tin. Markets, he said, are now assessing the next phase.
He added that fears around US trade tariffs have proven overstated. “Trump tariffs have turned out to be much less alarming for the global economy. Both the global economy and the US economy have proven to be very resilient,” he said, a trend that should support basic materials over time.Oil, in contrast, could face downside pressure. Yardeni expects demand to remain flat, driven in part by China’s rapid shift toward electric vehicles and diversified energy sources. “On the supply side, OPEC continues to produce at current levels, and we may get some Venezuelan oil as well,” he said, while noting infrastructure constraints. “Supply is outpacing demand, and I would not be surprised if Brent falls from around $60 to $50 over the next three to six months.”
Turning to US interest rates, Yardeni pushed back against expectations of imminent cuts. He highlighted the impact of a tax bill passed last July, retroactive to early 2025, which is expected to result in unusually large tax refunds. “That will be very stimulative for consumer spending,” he said, but warned it would also worsen deficit numbers. “In that environment, there is no reason for the Fed to lower interest rates. The risk is getting the bond vigilantes upset due to excessive fiscal and monetary stimulus.”
As a result, he believes rate cuts are unlikely in the first half of the year. On global markets, however, Yardeni remains constructive. “Emerging markets had very good performance last year. They beat the US, and that may continue this year,” he told ET Now.
India, he added, remains well-placed after a period of consolidation. “India consolidated last year after a huge run-up, and I think India will perform well this year, as it did prior to last year.”
Despite geopolitical noise and policy uncertainty, Yardeni’s message was clear: markets are focused less on fear and more on fundamentals—for now.